Analytics and updates on key energy events from the B1 Moscow Energy Center.

  • Gold prices climbed to a six-month high of $2,000 per troy ounce at the end of November, propped up by a softer dollar.

  • Copper prices continue on the down path, having tumbled to an average of $8,560 per tonne since the beginning of this year, a marked fall from $8,790 in 2022 and $9,300 a year earlier.

  • London Metal Exchange (LME) warehouse nickel stocks have been shrinking since the end of last year as monthly averages plummeted from 66,600 tonnes in 2022 to 41,700 tonnes in the first nine months of 2023, having bottomed out at 37,000 this August.
  • In September, iron futures traded at $119.5 per tonne on the Singapore exchange, the highest level since late April, having gained 2% YTD and never falling below the psychological threshold of $100 per tonne.
  • Over recent weeks, the world has been watching as Woodside Energy Group and Chevron became embroiled in a labor standoff with workers at their LNG plants in Australia. The news that these facilities could temporarily go offline has triggered an immediate reaction from the market.
  • The Eurozone Manufacturing PMI marked a sixth consecutive decrease in July, plagued by an accelerated decline in production volumes and new orders. These negative trends have a bearing on the steel sector as well.
  • Now that the second round of joint gas purchases on the EU Energy Platform has come to an end, the bloc wants to make this mechanism a permanent feature. So it’s about time we explore how well it works.
  • Global refined copper output in January-April 2023 soared 8% YoY to nearly 9 million tonnes, while consumption rose only 3% to 8.6 million tonnes, leading to a 384,000-tonne surplus, compared with a 43,000-tonne deficit in the same period last year. As a result, the price of copper started to go down. Will this trend persist and what will happen to prices in the longer term?
  • Exchange-traded prices for gasoline in Russia have rallied in the last six months. While AI-92 fuel is just about to surpass the peak level observed in 2021, AI-95 has been breaking records for several straight months
  • China’s metals sector remains on tenterhooks. According to the CISA, almost half of major mills were loss-making in the first five months of the year, while the country’s leading steelmakers warn that the industry faces a challenging second half of the year amid insufficient end-user consumption and ongoing thin margins.
  • The energy transition remains high on the global agenda, with much hope now being pinned on wind power generation, which rose 17% in 2022, having outpaced other renewables.
  • GDP in the euro area is down 0.1% for the second quarter on the trot. Industrial production is also trending down. The price of carbon permits in Europe plunged to the lowest level since mid-January 2023, beset by waning demand for electricity amid weaker industrial output.
  • The OPEC+ ministerial meeting held in Vienna on 4 June resulted in new decisions on output cuts. Learn more about OPEC+ members’ agreements.
  • After banning seaborne crude imports from Russia, the European Commission is now considering further restrictions on Russian supplies as part of a new package of sanctions, this time targeted at the Druzhba pipeline.
  • After skyrocketing to a record CNY 597,500 a tonne in 2002, the price of lithium carbonate in China continues to decline, from CNY 519,500 in January to CNY 165,500 in April this year, down around 68%.
  • While the nuclear option, which is perceived as one of the few viable solutions, has been on the discussion table for quite some time, Europeans are still divided on whether it is the right way forward.
  • 13 April 2023
    Gold continues on its bullish run, with a troy ounce again climbing above $2,000, having landed at $2,022 in early April, up 10.2% from the level at the beginning of the year and just a smidgen below the record high seen in August 2020.
  • While the global economy is on tenterhooks amid fears over what the future might bring, the members of OPEC’s Joint Ministerial Monitoring Committee have reaffirmed their commitment to the Declaration of Cooperation, which extends to the end of 2023.
  • As the global market struggles to shrug off the effects of the nickel crisis, which broke out on the London Metal Exchange (LME) last March and is still sending shockwaves through the industry, more bad news has come to the fore.
  • Inflation across major global economies has been running rampant over recent years, fueled by the COVID-19 pandemic and the energy crunch, with central banks forced to tighten their monetary policy and raise interest rates in response.
  • The European Union last year suffered a setback on its way towards decarbonization and low carbon power generation. Amid stubbornly high fuel prices, consumers were leaning more on coal-fired power in a bid for energy security.
  • Although energy price inflation in the euro area is slowing, prices remain high, while consumers have to increasingly rely on fossil fuels as a more easily available source.
  • Over the past two decades, gas pricing in Europe has moved away from oil indexation towards hubs as the preferred price formation mechanism driven by supply and demand, with gas-on-gas pricing making up 77% of gas volumes in 2021.
  • The LNG market last year was shaped by growing purchases in the EU and weaker demand in China, strangled by the country’s zero-COVID strategy.
  • Just a quick glance at the financial results of the five oil giants will be enough to realize that last year’s energy crisis, which is still reverberating across global markets, has been a bonanza for them.
  • E-mobility continues to gain momentum worldwide, but this trend may have a negative impact on the platinum group metals (PGM) market.
  • Though in December growth in energy prices in Europe decelerated to 25.5% YoY, the lowest rate in 2022, local consumers remain under immense pressure and are scrambling for ways to cut their energy use.
  • While experts reflect on the effects of the existing restrictions on Russian crude, another EU embargo, accompanied by a price cap, is expected to come into force on 5 February. And one may only guess how this will affect market prices globally.
  • While a pronounced tightening of monetary policies globally in 2022 in a bid to contain inflation has put downward pressure on gold.
  • 29 December 2022
    Will Russia cut its oil output? The imminent collapse awaited in 2022 never materialized. However, official estimates suggest that production will decline by 500,000-700,000 b/d in early 2023. And it’s hard to predict the reaction from global markets.
  • As we mentioned earlier this month, analysts did not anticipate a substantial rise in lithium-ion battery (LIB) prices in 2022, which were projected to grow only 2% YoY. However, more recent estimates suggest that growth may be higher than expected in June.
  • Market mechanisms are giving way to intergovernmental regulation. One of the examples is a price cap of $60 per barrel introduced this week by the G7 for Russian crude oil. In retaliation, Russia is planning to ban sales to countries applying this restriction.
  • Plug-in vehicles are becoming increasingly popular, with the number of passenger EVs on the road set to reach 77 million by 2025, or 6% of the global fleet, a notable rise from today’s 20 million.
  • The clock is ticking fast towards 5 December, the date when the EU restrictions on seaborne imports of Russian crude will take effect. Will this change the industry?
  • In our previous Energodigest, we wrote about the IEA’s World Energy Outlook, which is now followed by the World Oil Outlook, a similar set of forecasts authored by OPEC. How these forecasts have changed over the past year?
  • While there is a raft of news stories claiming that the world’s biggest economies are widely switching back to fossil fuels and aren’t going to give them up soon, the stats paint a different picture.
  • The global market for copper is already struggling to bridge the gap between supply and demand, which may widen even further in the coming years.
  • As the energy crisis deepens, creeping more and more into aluminum territory, the future of Europe’s solar and battery cell manufacturing becomes less certain.
  • At the JMMC meeting last week, OPEC+ decided to make the biggest output cut since May 2020 and extend its production co-operation agreement until the end of 2023, a move not expected by many.
  • The leaks discovered last week in two natural gas pipelines in the Baltic Sea have not only prompted major concern among climate activists, but have also brought renewed limelight on the ailing gas market.
  • While oil product prices are generally on the decline, reflecting the downward momentum for crude, they are still much higher than last September.
  • Nuclear power is again on the radar as the energy crisis picks up steam, with no letup in sight.
  • The oil market is now in ‘a state of schizophrenia,’ as the Saudi Energy Minister put it at the end of August, alluding to irrational pricing mechanisms.
  • While the EU is considering a price cap on Russian gas European businesses are trying hard to curb staggering energy costs in order to stay afloat.
  • Oil has lost 20% of its value since June, largely on fears of waning demand in response to global recession and further monetary tightening by many regulators, including the Fed with its ‘hawk’ rhetoric.
  • While many pessimists deny a future to renewables, global renewable energy funding hit a new high.
  • Storage facilities across Europe are gradually being replenished, but it’s important to understand how fast the accumulated gas stockpiles will be used this coming winter.
  • Projections of global economic growth keep getting worse. In late July, the IMF adjusted its expectations vs. April.
  • While Russian companies were selling crude and petroleum products at a discount resulting from geopolitical pressure, global corporations in Q2 2022 feasted on the victorious return of fossil fuel.
  • Russian crude continues to sell cheaper than the North Sea benchmark, with a barrel of Urals offered at an average discount of $21 in July.
  • While the energy crisis continues to wreak havoc on Western economies, it is also felt keenly in the East.
  • While at the beginning it seemed that supply disruptions would only last for a couple of months, it’s now becoming clear that the lack of gas will remain a pressing issue in the coming winter and it’s unlikely to be resolved until 2024.
  • More and more countries are stepping back from their push to scrap coal-fired power generation – at least for now.
  • Europe is still struggling after it banned Russian oil imports, and the debate about Russia’s ‘black gold’ is now in full swing.
  • Just as ten years ago, the world is now threatened by a major food crisis, with the food price index rising 25% y-o-y in May to an almost record high.
  • Import substitution is the burning issue not only for Russia. Energy-dependent countries are now racing to find alternatives to Russian supplies, with some of them even restarting mothballed coal mines.
  • The energy crunch that started last year has continued into 2022 amid growing geopolitical unrest, with the climate agenda now seeming to take a U-turn.
Russia and CIS oil and gas quarterly review
We are glad to present a new issue of the Russia and CIS Oil and Gas Quarterly Review, prepared by the B1 Moscow Energy Center.
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