What impact will the resumption of operation of Ecuador's largest crude oil pipeline OCP on July 5 have on global crude oil supply?
Ahead of the release of the U.S. Energy Information Administration EIA crude oil inventory data this week, Brent crude futures prices rose in early Asian trading.
As of 12:00 Beijing time, the August Brent crude futures main contract price was $85.37 per barrel, up 36 cents from the June 25 settlement price, while the final price of the contract fell $1 from the previous trading day.
The main crude oil contract price for August at the New York Mercantile Exchange was $81.22 per barrel, up 39 cents from the settlement price on June 25. The contract had fallen 80 cents from the previous day.
Market participants are closely watching the weekly report on U.S. crude oil inventories, which will be released by the EIA on June 26. The previous EIA report showed that U.S. crude oil inventories fell by 2.5 million barrels to 457.1 million barrels in the week ended June 14, a decrease mainly due to lower imports and increased exports. Compared with a year ago, inventories fell by 6.2 million barrels. Early data from oil product analysis company AlphaBBL showed that inventories in Corpus Christi, Texas, increased, while inventories in other key areas of Texas and Cushing, Oklahoma, fell.
Ecuador's energy minister, Roberto Duque, said the country's largest oil pipeline, OCP, with a daily processing capacity of 450,000 barrels, will resume operations on July 5. The pipeline was shut down on June 17 due to erosion of its path by the river in Quito, forcing 284 wells to shut down. According to hydrocarbon regulatory agency data, Ecuador's crude oil production plummeted to 391,000 barrels per day on June 24, down 20% from 486,000 barrels per day when the pipeline stopped on June 17, a decrease of 95,000 barrels.
ExxonMobil is advancing plans to develop the Hammerhead oil project in the deepwater Stabroek Block offshore Guyana. The project is expected to produce 190,000 barrels of oil per day by the end of 2029 at full capacity, and could potentially boost the block's oil resources beyond the company's current estimate of 11 billion barrels of recoverable resources. The company has also discovered several other oil fields in the Stabroek Block since starting crude oil production in 2019. According to government forecasts, with the gradual development of projects such as Liza 1, Liza 2, Payara, Yellowtail, Uaru, and Whiptail, Guyana's daily crude oil production will double to 1.25 million barrels by 2027.