Commodities: Global
OPEC Oil Output Fell Slightly to an average of under
27 million barrels per day (mbpd) as a fire in a prominent Iraqi field that halted production there was partially offset by increases in Kuwait and Venezuela. The US imported the least oil from Saudi Arabia since 1985 as the graph right shows. One would add that the amount basically is for blending purposes to reach optimal mixes in certain refineries and not a dependency. China’s crude oil imports fell -1.9% in 2024, the first annual decline in two decades outside of pandemic-induced declines, as tepid economic growth and peaking fuel demand dampened purchases. Imports totaled 11.0 mbpd, compared with 2023’s record 11.3 mbpd.
The EIA Maintained Its US Production Projection of 13.5 mbpd of oil in 2025, up from a record 13.2 mbpd in 2024. US operating oil rigs shifted back to 497 as of January 31st versus 482 on January 3rd. Per AAA, US average regular
unleaded gasoline prices per gallon ticked higher to $3.10 (+7¢) at the end of January with a lot of commentary that tariffs will drive energy prices higher. However, Canada is dependent on the US for most of its oil exports south to the Gulf of Mexico and even to supply eastern Canada from western Canada as there are no Canada-situated pipelines between the regions (such a pipeline was deemed hazardous to the climate). Apart from the Trans Mountain pipeline to Canada’s west coast, Canada depends on the US to ship its crude, even for domestic refining. Meanwhile, Mexico is a net energy importer from the US, period. In short, both countries depend on the US for daily economic operations. While undoubtedly all refiners will try to shift prices higher regardless, negotiations are still underway. We shall see. A judge dismissed New York City’s lawsuit seeking to hold Exxon Mobil, BP and Shell liable for misleading the public about their products, saying that the city could not claim its climate-conscious residents were sensitive to how fossil fuels cause climate change, only to then be duped by the oil companies’ failure to disclose how their fossil fuel products contributed to it. Yemen’s Houthi rebels vowed to hold off attacks on US and UK vessels, a sign that traffic on one of the world’s main trade routes could normalize after more than a year of disruption. Six ships linked to these two countries have successfully transited the area without coming under attack since mid-January.
US Natural Gas Output, demand and exports will both rise to record highs in 2025, the EIA said in its Short Term Energy Outlook rising from 103.1 billion cubic feet per day
(bcfd) in 2024 to 104.5 bcfd in 2025 and 107.2 bcfd in 2026. In 2014, US exports were 16 bcf total. In 2024, the number was 4.3 quadrillion. There are eight US LNG terminals now and another seven approved and under construction. Europe needs them to replace the cut-off Russian supplies! Not coincidentally, shipbuilding orders led by Liquefied Natural Gas (LNG) vessels boomed as seen the graph right.
Cocoa and Coffee Shortages Loom as cocoa smuggling from Ivory Coast to Guinea is taking on worrying proportions, exporters told Reuters, estimating that some 50,000 metric tons – worth about $573 million at current global prices – were illegally transported between October and December. Ivorian cocoa smuggled across the border was worth 5,000 CFA
francs ($7.95) per kilogram, while Ivory Coast’s fixed price paid to cocoa farmers was set at 1,800 CFA francs per kg in September. Brazil’s 2025 coffee output is expected to total 51.8 million 60-kg bags, national food supply agency Conab, a -4.4% drop compared to the previous year as adverse weather conditions affected yields. Comexim, which is one of the five largest private exporters of Brazilian coffee, projected 2025 production at 63.2 million 60-kg bags, -1.8% down from the 2024 crop. In either case, green coffee futures prices have basically doubled over the last two years.
All the best in your investing!
David Burkart, CFA
Coloma Capital Futures®, LLC
www.colomacapllc.com
Special contributor to aiSource