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British Prime Minister Boris Johnson has met with the de facto rulers of the United Arab Emirates and Saudi Arabia in efforts to ease gasoline prices as the West grapples with economic headwinds from Russia’s war in Ukraine.

British Prime Minister Boris Johnson met Wednesday with the de facto rulers of Saudi Arabia and the United Arab Emirates in efforts to ease skyrocketing gasoline prices, as the West grapples with economic headwinds from Russia’s invasion of Ukraine.

Johnson was seeking greater investments in the U.K.’s renewable energy transition and ways to secure more oil to lessen British dependence on Russian energy supplies.

His visit is also aimed at pressing these two major OPEC producers to pump more oil, which would have an immediate impact on Brent crude oil prices that nearly touched $140 a barrel in trading last week. Prices have eased to around $100 in recent days, in large part due to new pandemic lockdowns in China.

Johnson met with Saudi Arabia’s Crown Prince Mohammed bin Salman and the two agreed to work together to maintain energy stability and transition to renewable fuels, Johnson’s office said.

Johnson told reporters after the meeting that the two had a “productive conversation” and agreed on the importance to fight oil price inflation, but he did not spell out whether Saudi Arabia was receptive to increasing oil production.

“I think there was an understanding of the need to ensure stability in global oil markets and gas markets and the need to avoid damaging price spikes,” he said.

Earlier Wednesday, Johnson met with Abu Dhabi Crown Prince Mohammed bin Zayed for similar talks on energy supply amid the “chaos unleashed” by Russia’s invasion of Ukraine. He stressed “the importance of working together to improve stability in the global energy market” and ways to enhance energy ties, Downing Street said.

Johnson told reporters in Abu Dhabi that Russian President Vladmir Putin’s decision to invade Ukraine is “causing global uncertainty and a spike in the price of oil.”

Because of Europe’s reliance on Russian oil and gas, Putin has “been able to blackmail the West to hold Western economies to ransom,” he said, before stating: “We need independence.”

Pressing for an immediate release of more oil is a tall order to ask of Abu Dhabi and Riyadh, which are benefiting richly from high energy prices that boost their revenues and spending powers.

Ties between Western governments and Prince Mohammed also remain tarnished by the killing of Saudi writer Jamal Khashoggi. The prince has yet to hold a direct call with U.S. President Joe Biden, who is trying to revive Iran’s nuclear accord to the frustration of some Gulf states and Israel.

Saudi Arabia and the UAE have the spare capacity to pump more oil, but they’ve so far been unwilling to change course from a deal forged with Russia. The COVID-19 pandemic pushed down demand for oil, with Brent Crude prices averaging around $42 a barrel in 2020 before climbing to $70 last year on the back of an agreement by major oil producers to drastically curb production.

The deal, spearheaded by Saudi Arabia and Russia, calls for gradually increasing production levels each month as economies recover, but it did not account for the impact of the war in Ukraine, launched by Russia three weeks ago.

The UAE’s energy minister last week said the country is “committed to the OPEC+ agreement and its existing monthly production adjustment mechanism”. His statement followed a conflicting comment from the UAE’s ambassador in Washington, who seemed to suggest the UAE was in favor of releasing more oil on the market.

Western leaders have signaled that current wartime energy security demands that allied nations pump more.

The Biden administration dispatched two officials last month to Riyadh to talk about a range of issues — chief among them global energy supplies. In a call with Biden prior to the visit, King Salman doubled down on “the importance of maintaining the agreement” that is in place between OPEC producers and Russia, according to a Saudi readout of the call.

Many U.K. lawmakers, including those in Johnson’s own Conservative party, have questioned the decision to turn to Saudi Arabia, citing its recent mass execution of 81 people on Saturday. The U.N. human rights chief said that just over half were Saudi Shiites who had taken part in anti-government protests a decade ago, calling for more rights. Some were executed after trials that failed to meet due process guarantees, said U.N. High Commissioner for Human Rights Michelle Bachelet.

Johnson told reporters that he raised human rights issues with Prince Mohammed and defended himself against criticism that he was going from one dictator to another in search of fuel sources. He claimed that the situation was improving in Saudi Arabia and that it’s important to engage with the country.

“Things are changing in Saudi Arabia. We want to see them continue to change and that’s why we see value in engaging with Saudi Arabia and why we see value in the partnership,” he said.

abc NEWS by AYA BATRAWY, March 21, 2022

The Adani Group of Indian billionaire Gautam Adani has held early talks with Saudi Arabia about potential cooperation and joint projects, including buying a stake in Saudi Aramco from the Saudi sovereign wealth fund, Bloomberg reported on Friday, citing sources familiar with the development.  

Adani Group has held talks with Saudi Arabia, discussing the idea of buying a stake in the Saudi oil giant from the Public Investment Fund, although the Indian group is not expected to pay cash for such an investment, but rather have the deal structured as an asset swap or a broader partnership, Bloomberg’s sources said.

Indian billionaire Gautam Adani, who has made his fortune in coal, ports, and green energy, is the 11^th richest person in the world, according to the Bloomberg Billionaires Index.

Adani is the second richest person in India after Mukesh Ambani, the chairman of the biggest Indian private conglomerate, Reliance Industries.

It was Reliance Industries that had negotiated a major deal with Saudi Aramco for two years before announcing last November that it was scrapping what would have been a $15-billion agreement. Two and a half years ago, in August 2019, Saudi Aramco and Reliance Industries signed a non-binding letter of intent, under which Aramco was set to buy 20 percent in the oil to chemicals division of Reliance Industries. At an enterprise value of $75 billion for the entire division, the stake that Aramco would have bought would have been worth around $15 billion.

Now Adani and Saudi Arabia are reportedly in early talks about potential partnerships. Adani could offer the Saudi sovereign wealth fund to invest in infrastructure in India, one of Bloomberg’s sources said, while all sources stressed that all talks are at an early stage.

Saudi Arabia, the world’s top oil exporter, has been seeking to partner more with India, which is the third-largest oil importer globally and whose oil demand is expected to jump in the coming years.  

Oilprice by Charles Kennedy, 21 March, 2022

Europe became the largest customer of U.S. producers of liquefied natural gas recently, taking in more than 50 percent of total U.S. shipments over the last three months. But U.S. LNG, as well as LNG from other sources, would only provide short-term relief.

For starters, there are the long-term contracts that all LNG producers in the U.S., Australia, and Qatar already have with other buyers.

Then there is the question of insufficient LNG import capacity in Europe. Germany has announced a decision to urgently build two LNG terminals—the country has none currently—but chances are they will not be ready in a month or two. For context, building an LNG export terminal takes three to four years. Import terminals don’t need liquefaction trains, but they do need regasification facilities. 

Finally, competition from Asia is not going to diminish anytime soon, and energy industry insiders note there is limited LNG carrier capacity and LNG tankers take quite a bit of time to build: about two years and a half.

Yet the European Union has set itself the ambitious goal of reducing imports of Russian natural gas by as much as two-thirds by the end of the year.

“REPowerEU will seek to diversify gas supplies, speed up the roll-out of renewable gases and replace gas in heating and power generation. This can reduce EU demand for Russian gas by two-thirds before the end of the year,” the European Commission said earlier this week when it unveiled its plan for independence from Russian fossil fuels.

The measures outlined in the plan include mandating EU members to have their gas storage facilities filled up at 90 percent of capacity by October 1 this year, increasing LNG imports and diversifying pipeline imports, and boosting energy efficiency. Of course, a buildup in wind and solar generation capacity is also part of the plan, as is the increased production of hydrogen.

The increase in LNG imports appears to be one of the quickest ways to reduce dependence on Russian natural gas. The plan to build import terminals suggests this plan is long-term. However, as an analysis from Energy Intelligence strongly suggests, the chances for success of this specific part of the REPowerEU plan are quite slim.

The author of that analysis, Sarah Miller, makes several points that should sound an alarm in Brussels that they may be in over their heads. Some of these points concern the availability of LNG, as noted above, and the medium-term global plans for capacity expansion.

One very important point, however, has to do with the price of the commodity. “LNG remains a viable fuel source for Asia at the moment only because most of it is still price-linked to oil and therefore much cheaper than spot cargoes. That’s true even though oil is now well over $100 per barrel,” Miller writes.

In other words, Asian buyers mostly get their LNG through long-term contracts. Europe does not have this luxury at the moment because there is not enough LNG for producers to commit to such large new buyers. And there won’t be enough LNG for a while yet, given the time it takes to build a liquefaction plant, even without delays, which seem to be common in the LNG industry.

The situation is quite ironic because the EU has been trying to reduce its reliance on long-term contracts with Gazprom and increase the share of spot deals in natural gas in the past few years, perhaps acting on the assumption that gas supplies will always be abundant and therefore cheap.

Now, gas is not only through the roof, but LNG producers, as Energy Intelligence’s Miller notes, are demanding commitments of between 15 to 20 years from potential buyers.

“Will European buyers be ready to accept such extensive future obligations in order to deal with a near-term problem?” Miller asks, and answers her question with “Perhaps, if things get bad enough,” noting that even if things do get bad enough, deals will take time to seal.

The EU does not exactly have that time. The new heating season begins in less than seven months. That means less than seven months for member states to fill up their storage caverns at 90 percent with gas that will have to come from somewhere, although it is unclear where.

It also means less than seven months for a massive buildup in wind and solar capacity. Again, it is unclear how exactly this will happen and, not unimportantly, how much it will cost in light of the latest trends on the metals market. Also unclear is what happens when the wind stops blowing, which is what quite often happens during the European winter.

These are only a fraction of the questions that the EU’s energy independence plan raises. The answer to the question of whether LNG could replace the 40 percent of European gas consumption that Gazprom provides currently, however, seems crystal clear. There is no physical possibility for that.

Oilprice by Irina Slav, March 15, 2022

While the socioeconomic development of the Republic of Angola continues on an upwards trajectory, and its maritime cargo volumes increase, the long-term potential for the development of the country’s port infrastructure has been a priority for the government since the finalization of the 2018-2022 National Development Plan and is key to driving the country’s lucrative oil and gas industry.

With a 1,600 km coastline along the Atlantic Ocean, the Republic of Angola currently has five operational seaports, providing a clear maritime transport network and serving as an important regional transportation hub through which the country may facilitate the movement of goods to and from international markets. Angola’s five operational ports are its Luanda, Cabinda, Lobito, Soyo, and Namibe Ports, with plans currently underway to introduce its sixth seaport, the Barra do Dande Port, 50 km north of Luanda. The government of Angola has aims of developing this new port as an international one to alleviate strain on the Port of Luanda, which has faced years of encumberment.

The deep-water Port of Barro do Dande, located in the Bengo Province, will be developed in phases through public-private partnerships with Angola’s national oil company, Sonangol, and will feature the construction and installation of 29 storage tanks, terminals for solid and liquid bulk materials, as well as a container terminal, multi-use terminal, and petroleum support zone. Additionally, the project will see the construction of an 18.25 km quay wall, an embarkment area of 10.5 km², and a logistics support zone of 4.68 km². With engineering preparations having already been completed, the total cost of the port development is $1.5 billion.

“The idea is necessarily to ensure that Angola does in fact take advantage of its technical position at the maritime port level and that we do manage to take advantage of this wealth that is at our disposal,” stated Angola’s Minister of Transport, H.E. Ricardo Viegas D’Abreu, highlighting the strategic considerations of the Luanda Port hub at a national level.

Handling over 70 % of the country’s international imports, and 80 % of its non-petroleum foreign trade, the Port of Luanda serves as the Republic of Angola’s largest port and is the main import and export terminal for long-haul, maritime cargo. The port is administered by the country’s state-owned Empresa Portuária de Luanda, with global supply chains solutions company, DP World having been awarded a 20-year concession to manage and operate the facility. The company has since invested $190 million to transform the terminal into a regional maritime hub.

“With this partnership, it will be possible to promote and boost Angola’s industrial development, as well as its cross-border and international trade,” stated H.E. Minister D’Abreu.

Group Chairman and CEO of DP World, Sultan Ahmed Bin Sulayem, added that, “alongside this Multipurpose Terminal, there is still tremendous opportunity to further develop and integrate the country’s logistics and trade infrastructure and unlock more economic benefits. The Angolan government has an ambitious plan for this sector, and through this MoU, our primary objective is to find ways in which we can support the country to significantly maximize its strategic location and increase trade flows domestically and in the surrounding region.”

Meanwhile, Angola’s Lobito Port is the second largest in the country, and is strategically connected to the Benguela railway network, linking the southern African country to the Democratic Republic of the Congo, with plans currently underway to extend the network into Zambia. Providing services primarily to facilitate the country’s oil and gas industry, the Cabinda Port is located in Angola’s oil-rich northwestern province of Cabinda, while the country’s southernmost Port of Namibe focuses primarily on fishing activities in the region.

It has been highlighted by the government of Angola that in order for the country to become more self-sufficient, it will be imperative for Angola to begin producing more refined materials for itself and for the foreign market. Under its National Development Plan, the government has sought to promote infrastructure development through the expansion of its seaports and optimizing the role that local companies play in their development. Despite Angola’s construction sector accounting for over 15.5 % of its GDP, the sector remains dominated by Chinese, Brazilian, and Portuguese companies.

Serving as a key bulk infrastructure asset for both economic and social gains of Angola, development of the country’s port infrastructure will be imperative for attracting international investment and driving the country’s oil and gas sector, which accounts for approximately 50% of GDP and roughly 90% of exports.

EnergyCapital&Power by Matthew Goosen, March 15, 2022

Saudi Aramco has lifted its price to Asia for its flagship crude oil grade, Arab Light, to $4.95 a barrel premium over Oman/Dubai crude, off which Middle Eastern producers price their oil going to Asia, the oil company said on Friday.

It is the largest differential for Arab Light ever and a daring move for the world’s largest crude oil exporter.

The increase in price for Arab Light to Asia next month is a staggering $2.15 per barrel.

Aramco also raised the OSP of Arab Light to Europe and the United States, at premiums to $1.60 per barrel to ICE Brent, and $3.45 over the Argus Sour Crude Index, respectively.

The price increase comes as no surprise. Brent crude prices have increased $17 a barrel in the last week alone, and the Asian oil market has grown exceptionally tight as buyers there look for more and more oil from the Middle East as some have grown wary of purchasing Russian crude oil.

Saudi Arabia typically sets the pricing trends for the other Middle Eastern oil producers and is seen as a bellwether for which way the market is heading, and is interpreted as a signal that Saudi Arabia believes oil demand will remain strong, and will continue to tighten.

Saudi Arabia has increased more than just Arab Light. The price for all Saudi crude grades to Asia will increase for April, as well as all Saudi crude grades to the United States and Europe.

The price increases come as OPEC+ met earlier this week and determined that no additional output increase was necessary to stabilize the market, agreeing to an output increase of 400,000 bpd as previously planned.

Oilprice by Julianne Geiger, March 7, 2022