Brent crude prices were slightly lower at $76 a barrel on Thursday, little changed from what they were before Saudi Arabia announced on Sunday that it would voluntarily cut one million barrels per day of supply. July, subject to extension.
“There’s this macroeconomic sentiment, this general feeling of anxiety…that says…the economy is slowing down,” Colin Parfitt, Chevron’s vice president of midstream operations, told Reuters on the sidelines on Thursday. an energy conference.
“Saudi Arabia cut 1 million barrels a day…and the market yawned. It’s all about macro sentiment,” he added.
Parfitt said the drop in prices masks the fact that the oil market hasn’t changed much from a year ago and is still tight, with limited spare capacity to meet demand. increased in the future.
He added that the resumption of economic activity in China and with it the increase in demand could quickly change the sentiment in the market.
natural gas
The natural gas market has been in short supply since the start of the war in Ukraine, as Russia halted part of its production when it lost European buyers due to sanctions and pipeline damage.
Parfitt said Chevron sees Europe as a strong market for near- and medium-term gas demand as the continent looks to replace Russian supplies.
For long-term demand, he added, Asia is the best bet.
Chevron is a major natural gas producer, pumping more than half of its production from the United States and Australia.
Parfitt said the company is looking at options to sell more gas from the Leviathan field in the eastern Mediterranean, either through pipelines in the region or by setting up a floating LNG facility.
He added that LNG would provide more flexibility and allow Chevron to sell into the stronger market.
He said that while in many countries natural gas is seen as a transitional fuel as an alternative to coal in power generation, in some places it may become the fuel of choice in the long run.
“People often talk about gas as a transition fuel, but I’m not sure…I think it might be a target fuel,” Parfitt said.
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