Key facts
- Oil prices eased as renewed Iran talks and recovering Saudi exports tempered supply fears.
- ICE Brent crude futures moved towards $104 per barrel.
- Saudi Arabia restored flows through its East-West Pipeline to around 3.5 million b/d after a 10-day halt.
- Europe's LNG imports are increasing, with US LNG flows accounting for 69% of the total.
- QatarEnergy extended its LNG supply force majeure for Asian customers through November.
- The Trump administration finalized new fuel economy standards requiring automakers to achieve a fleet average of 34.9 miles/gallon by 2031.
Oil prices eased as renewed diplomatic efforts between the US and Iran, coupled with the restart of Saudi Arabia's East-West pipeline, tempered supply concerns. The prospect of US-Iran negotiations has cooled last week’s rally, bringing ICE Brent lower towards $104 per barrel, although comments from Donald Trump suggested the talks might lead nowhere.
Saudi Arabia restored flows through its East-West Pipeline to around 3.5 million b/d following a 10-day halt triggered by drone strikes. However, the 7 million b/d system will remain below capacity for a further 4-5 weeks, and the Houthi risk remains a threat to recovering Saudi flows.
Europe is increasing its liquefied natural gas imports ahead of the winter heating season. The 30-day moving average of Europe’s LNG imports stood at 267,000 metric tonnes per day, catching up with last year’s trendline, thanks to a recovery in US LNG flows, which now account for 69% of the total. Landed LNG prices in Europe are hovering around $24 per MMBtu, making the arbitrage for US LNG workable.
QatarEnergy has prolonged its LNG supply force majeure for Asian customers through November as Hormuz flows remain restricted, with monthly loadings down 80% compared to pre-war levels. The International Energy Agency stated that member states could discuss further strategic stock releases if supply conditions deteriorate, with the agency closely monitoring diesel and product markets.
The Trump administration finalized its revamp of fuel economy standards, requiring automakers to achieve a fleet average of 34.9 miles per gallon for cars and light trucks by 2031, a decrease from Biden’s previous mandate.