Commodity markets were weighing supply side risks this week, as key producing countries continue to grapple with sanctions and political upheaval. In Libya, Africa’s third-largest oil producer and a significant supplier of gas to Europe, violence has escalated and the country is in danger of falling back into civil war. International oil companies like Italy’s Eni have started evacuating staff from Tripoli. Meanwhile, despite sanctions Iran’s oil exports recovered in March off the back of Chinese and South Korean buying. But based on data and information from market sources, Iranian production has recently declined, and the country drew heavily on stocks to support the export surge. Russia’s energy sector is also subject to US sanctions, which include measures targeting the development of Russian deepwater and Arctic offshore projects. Speaking at a regional forum, Russian President Vladimir Putin said that sanctions had hampered, but not stopped, development of hydrocarbons in the Russian Arctic. Separately, there were new question marks in Europe over key routes for the transport of Russian fuels. The European Commission cast doubt over the timely startup of the Nord Stream 2 pipeline, while the Belarusian president threatened to suspend Russian oil transit through the country amid trade frictions… continue reading
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Source: CTRM Center