Power Up: Oil markets weigh tariffs, OPEC+ output policy

March 10 - By Liz Hampton

U.S. energy markets editor

Hello Power Up readers! Uncertainty remains a key theme in the oil markets as concerns around tariffs and rising output from the Organization of the Petroleum Exporting Countries and allies continues to weigh on markets. Potential sanctions on Iranian oil exports have provided some support to prices. Global Brent futures were up by about 9 cents to $70.45 a barrel on Monday morning, while U.S. West Texas Intermediate (WTI) crude was up 15 cents to $67.19 a barrel. Henry Hub natural gas futures were trading around $4.494 per million British thermal units, up around 2.2%.

Novak hints at more OPEC+ output cuts

CERAWeek kicks off in Houston

The annual energy conference was underway in Houston today, drawing in some 8,000 delegates and energy ministers and executives from all corners of the world. U.S. Energy Secretary Chris Wright kicked off the conference on Monday in a speech advocating for the fossil fuel industry to help meet growing global energy demand.

Wright, along with U.S. Interior Secretary Doug Burgum, met with oil executives in Houston last night over dinner, where he promised to speed up permitting and bolster the oil and gas industry. He also indicated support for nuclear development, one of the dinner attendees told Reuters.

Still, oil markets continue to face a period of potential upheaval as U.S. President Donald Trump continues to waffle on his tariff strategy. Last Thursday, he agreed to pause 25% tariffs on Mexico and Canada for a month.

Russian Deputy Prime Minister Alexander Novak added to that uncertainty on Friday, when he said the Organization of the Petroleum Exporting Countries and allies would proceed with a planned oil output increase in April, but could reverse that decision if there were market imbalances. Novak's comments drove oil prices up by $1 a barrel.

The producer group is expected to start raising output by about 138,000 barrels per day (bpd) in April. Record output from Kazakhstan was a factor in OPEC+'s decision to boost output, Reuters exclusively reported this week.

Meanwhile, Trump on Friday raised the possibility of imposing large-scale U.S. sanctions on Russia until a peace deal with Ukraine is reached. This comes days after he paused aid and intelligence sharing with Ukraine.

Trump has threatened banking sanctions and tariffs on Russia and his comments comes after Russian forces have almost surrounded Ukrainian troops who entered Russia's Kursk region last summer.

In other news, Abu Dhabi National Oil Company is considering listing its international investment arm XRG on an exchange outside of the United Arab Emirates, sources told Reuters on Friday. This would potentially create one of the largest listed energy companies globally.

ESSENTIAL READING

The U.S. will seek up to $20 billion to accomplish President Donald Trump's plan of refilling the Strategic Petroleum Reserve to its maximum capacity, Energy Secretary Chris Wright said in a media interview. The SPR can store some 727 million barrels of oil, but is currently holding 395 million barrels.

Indonesia is rolling out a $1.5 billion initiative to distribute liquefied natural gas (LNG) on a small scale to feed dozens of power plants that are currently running on diesel, Emily Chow and Fransiska Nanogy report. Indonesia is the seventh largest LNG exporter. The plan raises the risk that it may need to start importing the super-chilled gas later this decade.

Norwegian oil company DNO said it will buy rival Sval Energi from private equity group HitecVision in a deal valued at $1.6 billion. This marks further consolidation among North Sea oil and gas producers.

Venture Global's shares slumped to their lowest level since its IPO on Thursday as the liquefied natural gas producer forecast its 2025 core profit to fall below Wall Street expectations. Shares fell 22.5%. The company also said it expects costs for its Plaquemines LNG plant to be $2 billion higher than previous forecast, and said it would invest an additional $18 billion in phase 3 of the plant, adding another 24 trains.

U.S. oil and gas drillers cut the number of rigs operating for the first time in six weeks, Baker Hughes said on Friday. The number of oil and gas rigs operating fell by one to 592, down 30, or 5%, from last year's levels.

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