The Feb’25 Brent futures contract was supported this morning, rising from $72.10/bbl at 07:00 GMT to $72.50/bbl at 10:30 GMT (time of writing). Crude oil prices were elevated amid reports that OPEC+ is likely to extend oil production cuts at its 5 Dec meeting until the end of Q1’25, four OPEC+ sources told Reuters. In the news today, the Pentagon has announced a new $725 million arms package for Ukraine which includes anti-personnel mines and air defence missiles. Meanwhile, diplomats expect Ukraine’s invitation for NATO membership is unlikely to be approved at the NATO foreign ministers meeting, taking place 3-4 Dec in Brussels. In other news, Indonesia has launched auctions for six oil and gas exploration blocks, bringing the total number of blocks offered this year to 11, according to the country’s Energy and Mineral Resources Ministry. Dadan Kusdiana, a senior energy ministry official, stated that the six blocks have a combined potential of 48 billion barrels of oil equivalent. Finally, a sophisticated fuel oil smuggling network is believed to generate at least $1 billion per year for Iraq and its proxies since Prime Minister Mohammed Shia al-Sudani took office in 2022, five sources told Reuters. The operation exploits Iraqi government subsidies for fuel oil allocated to asphalt plants, diverting 3.4mb to 5mb of fuel oil each month for export, primarily to Asia. In addition, Iraq has halted operations at its Basra oil refinery on 1 Dec due to overloaded storage tanks, with the facility producing approximately 260kb/d of fuel oil prior to the shutdown, according to Zawya. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.30/bbl and $1.25/bbl, respectively.
