The Jul’25 Brent futures contract saw prices continue rallying up to $62.90/bbl at 16:59 BST (time of writing). In the news, the US and UK have agreed on a deal to lower tariffs on some goods. Key points include: cars, steel, planes, and agricultural tariffs. Both sides will continue negotiations on broader trade topics, including pharmaceuticals and remaining tariffs. In other news, OPEC+’s oil output slightly declined in April by 30kb/d to 26.60 mb/d, despite planned production increases. The drop was mainly due to reduced exports from Venezuela and smaller cuts in Iraq and Libya. Iran, meanwhile, raised its output, largely offsetting the declines. While OPEC+ has started easing its production cuts, the full rebound may be limited by US actions targeting Iran and Venezuela. Saudi Arabia, the UAE, and Kuwait held steady, though actual output levels remain debated. Recent US sanctions on two small Chinese refiners, Shandong Shouguang Luqing and Shandong Shengxing, have disrupted their operations and deterred other independent Chinese refiners from buying Iranian oil. The sanctions have led to port access bans, loss of state bank funding, and shipment rejections. Nigeria has raised its oil production target to 2.5 mb/d by year-end, up from 2 million, according to Petroleum Minister Heineken Lokpobiri. Despite not hitting 2 mb/d in nearly a decade, Lokpobiri believes the goal is achievable due to progress in tackling oil theft and vandalism. Exxon’s new $1.5B investment in deep-water projects adds momentum. Finally, the Jul/Aug front month spread is at $0.36/bbl and the 6-month Jul/Jan spread is at $0.81/bbl.
