Latest Commodity News

The Strait of Hormuz remains severely restricted for tanker traffic two months after the Iran war began, causing a massive loss of crude oil supply. The U.S. has imposed a naval blockade to stop Iranian oil exports, but Iran controls most vessel movements and shows no sign of yielding. The deadlock has led to the loss of hundreds of millions of barrels of crude, with estimates suggesting 600-700 million barrels lost so far, and the figure could reach 1 billion barrels if the situation persists.

U.S. President Donald Trump faces a legal deadline under the 1973 War Powers Resolution, requiring termination of military action within 60 days unless Congress authorizes it. The deadline expires on Friday, though the administration argues a ceasefire has stopped the clock. Despite political maneuvering, no resolution to the Hormuz deadlock is in sight, and oil prices continue to rise as global supply buffers are exhausted.

Disrupted energy flows have triggered a global race for alternative supply, sending energy prices soaring and raising concerns of a global recession. In the U.S., gasoline prices hit their highest level since July 2022. Analysts warn that current buffers are insufficient to replace lost barrels, and prices will need to adjust to balance supply and demand.

China is reversing its restrictions on refined fuel exports after initially halting shipments during the U.S.-Iran conflict. This change indicates that domestic fuel inventories in China are now at comfortable levels, allowing state-owned refiners to resume exporting. The decision comes as many parts of Asia face a severe fuel shortage due to disrupted energy flows from the Gulf region through the Strait of Hormuz.

Earlier in the week, reports emerged that Chinese state-owned refiners, including Sinopec Group and China National Petroleum Corporation, were applying for government permits to resume fuel exports in May. By the end of the week, Bloomberg reported that these companies had received government approval to export 500,000 tons of fuel next month. The shipments will include gasoline, diesel, and jet fuel.

The fuel will be loaded onto tankers and likely sent to neighboring Asian countries such as Vietnam and Laos, providing much-needed relief amid a worsening fuel crunch. This move by China comes shortly after the International Monetary Fund, World Bank, and International Energy Agency urged countries to avoid panic hoarding of energy supplies. Analysts at JPMorgan had warned that Asia would bear the most immediate impact from the Gulf energy shock.

Following the Russian invasion of Ukraine in 2022, Western powers imposed sanctions on Russian energy to pressure Moscow financially. While Europe and the U.S. reduced dependence, countries like India and China increased imports of discounted Russian crude, boosting energy security. By 2024, China imported a record 100 million tonnes of Russian oil, and India spent around $140 billion on Russian energy, deepening ties amid U.S. tariffs.

The U.S. has recently shifted its stance, extending a sanctions exemption on Russian crude through May 2025 to alleviate global oil supply disruptions caused by the U.S.-Israeli attack on Iran and the subsequent closure of the Strait of Hormuz. This move is expected to lower oil prices and allow countries to legally purchase Russian oil. The situation in the Strait remains volatile, with Iran reopening and closing it amid ongoing blockades.

The turmoil has driven India and China to compete for Russian and Saudi oil, with Indian imports hitting record highs. Indonesia also plans to buy 150 million barrels from Russia to secure supplies. The increased trade with Russia may channel funds into its war efforts, contradicting the original intent of sanctions. The Middle East conflict continues to disrupt energy trade and drive up prices, pushing nations to seek alternative sources.

BP's new CEO Meg O'Neill has announced a significant corporate reset, splitting the company into upstream and downstream divisions to prioritize oil and gas operations. This move marks a departure from previous renewable energy ambitions and aims to improve financial performance after years of mediocrity.

In its first quarter under O'Neill, BP's profit more than doubled, driven by strong trading results amid Middle East turmoil. The company also focused on reducing debt by redirecting funds from share buybacks to bond repayments, signaling a commitment to balance sheet repair.

Despite strong earnings, shareholder divisions emerged, with votes against the chair and some climate reporting proposals. However, the stock has risen 63% from its lows, and activist investor Elliott Management has expressed cautious optimism about the new direction.

Mexico's state-owned oil company Pemex has faced renewed criticism following a major oil spill in the Gulf of Mexico during February 2025. The spill, initially detected as a 19-square-mile slick, eventually spread over 370 miles along the coast, affecting communities dependent on fishing and tourism. Environmental groups estimate up to 800 tons of oil were released, causing significant damage to coastal and marine ecosystems.

Pemex initially denied any leak but later acknowledged a pipeline rupture near its Abkatun field, with CEO Victor Rodriguez claiming maintenance was conducted without informing leadership. The incident highlights Pemex's poor health and safety record, which includes multiple fires, explosions, and accidents in recent years. This has hindered the company's ability to attract financing from investors demanding stricter environmental and safety standards.

Pemex carries a massive debt of over $85 billion and received $22.7 billion in government support in 2025 to help reduce it. However, depleting oil fields and neglected infrastructure due to lack of funds complicate its recovery. The company aims to increase domestic refining at its new Dos Bocas plant to cut costs and reduce fuel imports, but its future remains uncertain given ongoing safety and environmental challenges.

The rapid expansion of artificial intelligence is driving a massive increase in energy demand, with tech giants like Google and Meta experiencing significant rises in carbon emissions. Google's emissions have jumped 48% in five years, putting its 2030 net-zero target at risk. Despite clean energy pledges, these companies are currently heavily dependent on natural gas, funding new gas plants to power their data centers.

In response to growing pressure, Big Tech is investing in next-generation clean energy solutions. Meta has partnered with Overview Energy to develop space-based solar power, aiming for up to 1 gigawatt of capacity. However, the technology is still years away from commercial viability, with a pilot satellite not expected until 2028. Similarly, investments in nuclear fusion and advanced geothermal energy are being pursued, but these are long-term bets.

In the near term, the reliance on fossil fuels continues to grow. Meta is funding ten new gas plants for its Louisiana data center, and Google is building a gas facility in Texas. The AI boom's energy consumption remains uncertain, but experts agree demand will sharply rise. This strain on power grids is currently passed on to consumers, but tech firms are beginning to secure their own energy supplies to mitigate price impacts.

The Iranian rial has hit a record low against the US dollar, falling to 1.81 million to the dollar on April 29 before recovering slightly. The currency has lost nearly 15% of its value in recent days due to ongoing conflict and economic pressures.

The United States and Israel launched air strikes on Iran on February 28, and the US imposed a naval blockade on Iranian ports and vessels on April 13. These actions have disrupted Iran's oil exports, hampered domestic production, and fueled inflation, which rose from over 40% to 50% by early April.

In response, Iran effectively closed the Strait of Hormuz to international shipping, disrupting global oil and gas supplies. This caused Brent crude prices to surge by nearly 7% to over $126 a barrel on April 29, the highest since 2022. The conflict has also led to significant price increases for basic goods in Iran, sparking nationwide protests in January that were met with a violent crackdown.

Venezuela's oil exports reached 1.23 million barrels per day (bpd) in April, the highest level since 2018, driven by increased shipments to the United States, India, and Europe. This marks a 14% rise from March, with 66 cargoes departing Venezuelan ports compared to 61 the previous month.

The increase follows the capture of Nicolas Maduro and the installation of an interim government, which led Washington to ease sanctions and take control of oil sales. This shift has allowed trading houses and joint-venture partners, including Chevron, to access U.S., European, and Asian markets. Chevron is already importing Venezuelan crude into Gulf Coast refineries designed for heavy barrels, while India is also increasing its intake.

International oil companies are re-entering Venezuela. New agreements with U.S. firms Hunt Overseas and Crossover Energy target the Orinoco Belt, and European majors like Eni, Repsol, and BP are expanding or exploring positions. ExxonMobil and ConocoPhillips have sent teams to assess opportunities. Despite this, Venezuela still produces a fraction of its historical capacity, and rebuilding infrastructure will require tens of billions of dollars over several years. For now, the barrels come from inventory and incremental output gains.

The number of active drilling rigs for oil and gas in the United States increased this week, according to data from Baker Hughes. The total rig count now stands at 547, which is 37 fewer than the same time last year. Specifically, the oil rig count rose by 1 to 408, while the gas rig count also increased by 1 to 130. The miscellaneous rig count rose to 9.

Weekly U.S. crude oil production remained relatively unchanged at 13.586 million barrels per day, which is 276,000 barrels below the all-time high. The number of crews completing wells, as measured by Primary Vision’s Frac Spread Count, increased by 4 to 169 crews during the same period.

In the Permian Basin, the active drilling rig count fell by 1 to 241, down 46 from a year ago. Meanwhile, the Eagle Ford saw a rise of 1 rig to 43, still 3 fewer than last year. Oil prices declined on Friday amid hopes of a deal with Iran that could restore oil flow through the Strait of Hormuz. Brent crude traded at $108.30 per barrel, down 1.91%, while WTI was at $101.90, down on the day but up roughly $8 week over week.

Chevron's first-quarter earnings surpassed expectations as higher oil prices boosted upstream profits, despite a significant loss in refining. Adjusted earnings per share came in at $1.41, above forecasts. Upstream earnings rose 4% year-on-year to $3.9 billion, driven by a surge in crude prices during the quarter amid disruptions from the Iran conflict and the effective shutdown of flows through the Strait of Hormuz.

Chevron's limited exposure to the Middle East—less than 5% of total production—allowed it to capture the upside without facing the operational challenges experienced by some peers. U.S. production remained above 2 million barrels per day for the third consecutive quarter, while global output slightly declined to 3.86 million barrels of oil equivalent per day due to downtime at Tengiz. The downstream segment swung to an $817 million loss from a $325 million profit a year earlier, attributed to timing effects from hedges and inventory accounting. These paper losses are expected to reverse in the second quarter.

Net income fell to $2.2 billion from $3.5 billion a year earlier, despite improved pricing and upstream earnings growth. Free cash flow was negative $1.5 billion, pressured by working capital and higher spending related to the Hess acquisition. Chevron returned $6 billion to shareholders, including $3.5 billion in dividends and $2.5 billion in buybacks, though the buyback pace did not increase despite the stronger pricing environment.