OIL MARKET: Despite US sanctions and promises by top American diplomats, Iranian oil production continues to surge higher and higher, reaching almost 2.9m b/d in May, according to @IEA data. That's the highest in about 4½ years | #OOTT #Iran 🇮🇷⛽️

Replacing coal with natural gas "Exercising pragmatism" -- Shell CEO Wael Sawan Spot on. I will add nuclear. And solar, and wind too. But above all, get rid of coal, even if the replacement is gas.

For the first time, Shell discloses (a bit) of the monster profitability of its oil and gas trading operation It says trading and optimization lifts RoACE by 2-4% Its average capital employed in 2022 was ~$270 billion, so that gives a range of about $5.4-$10.8 billion per year

COLUMN: Disregarding the boiler plate, the press release runs at 623 words. In it, Shell mentions every buzzword you would imagine a big oil producer uttering when it’s trying to buy the love of Wall Street — all of them, except one word: oil. @Opinion

To meet the net-zero by 2050 climate change target, the IEA modelled that global oil demand needed to drop to ~75m b/d by 2030. In its 5-year medium-term forecast, published today, the IEA sees oil demand at ~106m b/d by 2028. It's safe to say we won't meet the 2030 target.

OIL MARKET: @IEA again lifts its forecast for 2023 oil demand growth, now to 2.4m b/d (up from 2.2m b/d last month), and in it's first look at 2024, it sees another ~0.9m b/d y-on-y increase. But IEA also says that demand growth will decelerate significantly from 2026-28 onward.

'The World for Sale' is now out in Polish Z wielką przyjemnością zawiadamiam, że nasza książka „Świat na sprzedaż” jest już dostępna w języku polskim

The capex cut is rather significant. It goes from $23-$27bn in 2023 (mid-point $25bn)... .. to $22-$25bn in 2024-25 (mid-point $23.5bn) I argued in the past at @Opinion (see below) that it was badly needed.

And this is a brutal statement by Shell CEO Wael Sawan, effectively erasing the legacy of his predecessor who made a big bet on shifting toward renewables: "We will invest in the models that work – those with the highest returns that play to our strengths" #OOTT $SHELL

BREAKING: Shell hikes dividend by 15%; announces capex cut After BP, Shell also goes back to oil (and gas): Shell abandons its plan to cut oil production annually by 1%-2%; now aims to "stabilising liquids production to 2030". #OOTT $SHELL

*PUTIN SAYS RUSSIA MULLS QUITTING GRAIN DEAL

COLUMN: If you eat -- or farm --, this big grain trading M&A deal should worry you | #OATT via @Opinion

The combination is larger than it appears at first sight. Effectively, this is 2 major agri commodity traders (Bunge and Glencore Agri) and 2 medium-sized traders (Viterra and Gavilon) merging, as Glencore bought Viterra in 2012 and Gavilon in 2022 before the deal with Bunge.

BREAKING: Big M&A deal in the commodity trading industry @Bunge buys @Glencore's grain trading business, called Viterra, for $6.2 billion in shares plus $2 billion in cash. After the deal, Glencore and several Canadian pension funds would own ~30% of Bunge.

CHART OF THE DAY: Despite one OPEC+ production cut, and another Saudi unilateral top-up cut, Brent crude dropped below $72 a barrel, approaching the low of the year. Riyadh is witnessing a big drop in revenue via **lower prices** and **lower production** | #OOTT

Russia is trying to introduce a minimum price for its wheat exports, and the UN is worried that it might leave the "Black Sea Grain Export Corridor" in July. As I warned in this @Opinion column in March, Vladimir Putin is flexing the muscle in grains

ICYMI: My @Opinion column today arguing that it's time to put Exxon Mobil back into the Dow Jones Industrial Index | #OOTT $XOM

The UK national grid has put a coal-fired power plant on standby to meet extra demand for electricity from air conditioning during today's heat wave (there's also quite a lot of maintenance in other plants, plus low wind production, and a faulty UK-Norway interconnector)

THE NEW OIL GEOPOLITICS "This is the first ever Russian oil cargo to Pakistan and the beginning of a new relationship between Pakistan and Russian Federation" -- Pakistan's Prime Minister #OOTT #Pakistan #Russia

OIL MARKET: Goldman Sachs lowers its price forecast for 2024 on larger-than-expected production by sanctioned countries Russia, Iran and Venezuela. I wrote about the same topic in this @Opinion column a few weeks ago: #OOTT

COLUMN: I'm probably, again, a contrarian here, but it's time to let Exxon Mobil back into the Dow Jones Industrial Average index | #OOTT $XOM @Opinion

In the latest twist of the Glencore-Teck battle, the commodity trader says it has offered to buy the coal business of the Canadian miner for cash. Glencore would spin off the combined coal business in 12-24 months. But Glencore reiterates it’s also keen to buy the whole of Teck