The Oct’25 Brent Futures contract fell to $68.75/bbl at 08:57 BST. Prices then traded rangebound between $68.99/bbl and $68.80/bbl before falling to $68.60/bbl at 11:30 BST (time of writing). In the news, OPEC+ agreed to a September output increase of 54kb/d, completing the reversal of earlier cuts totalling about 2.5 mb/d. While the hike met expectations, traders remain cautious amid escalating geopolitical risks, including potential new US sanctions on Russia and threats of 100% tariffs on Russian oil buyers as Washington pressures Moscow over Ukraine. In other news, smaller Chinese oil companies are expanding rapidly in Iraq, investing billions and aiming to double their output there to 500kb/d by 2030. This marks a shift in Iraq’s oil sector, long dominated by large Chinese state firms and Western majors, many of which have scaled back. These companies have significantly reduced drilling costs and timelines, often completing developments in two to three years compared to five to ten for Western firms. However, concerns remain about transparency, technical standards, and heavy reliance on Chinese labour over local hires. BP announced its largest oil and gas discovery in 25 years in Brazil’s deepwater Santos basin. BP plans to develop a major production hub offshore Brazil and currently holds 100% of the Bumerangue block under a production-sharing contract with Pré-Sal Petróleo SA. Early tests show high carbon dioxide levels, with further analysis planned to assess the block’s potential. BP’s shares rose 1.4% on the news, ahead of its second-quarter earnings report. Finally, the front-month Oct/Nov spread is at $0.77/bbl and the 6-month Oct/Apr spread is at $2.24/bbl.
