Trump Administration & US Oil: The oil and gas industry has presented President-elect Donald Trump with a five-point policy agenda, urging him to expand LNG exports, increase drilling on federal lands, ease pipeline permitting, repeal strict vehicle emission standards, and maintain corporate tax rates. Trump plans to establish a National Energy Council, chaired by North Dakota Gov. Doug Burgum, to streamline energy policy and cut regulatory red tape. The council will coordinate efforts across federal agencies to promote U.S. energy dominance, with industry insiders expecting significant deregulation under Trump’s picks for key energy roles. Analysts believe Trump’s approach aims to boost the U.S. share of the global oil and gas market, especially against OPEC producers. The American Petroleum Institute is pressing for an end to the Biden administration’s pause on new LNG export projects and more federal leases for oil and gas development in areas like New Mexico, Alaska, and the Gulf of Mexico.

U.S. Oil Imports Hit Historic Low: U.S. net crude oil imports are projected to drop 20% to 1.9 million barrels per day in 2025, the lowest level since 1971, due to increased domestic production and reduced refinery demand, according to the EIA. U.S. oil production is expected to rise from 13.24 million bpd in 2024 to 13.52 million bpd in 2025, while refinery processing is projected to decrease by 200,000 bpd due to refinery closures and reduced capacity. Announced refinery shutdowns, including those by Phillips 66 and LyondellBasell, will further reduce U.S. demand for imported crude, with exports likely to increase as domestic production grows. President-elect Trump’s proposal to impose 25% tariffs on Canadian and Mexican imports, including crude, could further limit imports. The EIA forecasts global oil demand to reach 104.3 million bpd in 2025, while Brent and WTI crude prices are expected to average $73.58 and $69.12 per barrel, respectively, reflecting downward revisions from earlier forecasts.

OPEC+: OPEC has reduced its forecasts for global oil demand growth for both 2024 and 2025, marking its fifth consecutive downward revision. The cuts reflect weaker demand from key regions, including China, India, and other parts of Asia, Africa, and the Middle East. OPEC now expects global demand to rise by 1.61 million barrels per day (bpd) in 2024, down from the previous forecast of 1.82 million bpd. The shift highlights challenges for OPEC+, which delayed plans to increase production until April 2025 amid declining oil prices. While OPEC's demand outlook remains more optimistic than the International Energy Agency's forecast of 920,000 bpd growth in 2024, market uncertainty persists over China's economic trajectory and the global energy transition.

Market Overview: Oil prices rose about 1% today as optimism over China's economic stimulus plans outweighed OPEC's downward revisions for demand growth in 2024 and 2025. OPEC+ delayed its plan to increase production, citing weak demand from China and rising non-OPEC+ supply, but analysts expect China's new policies to boost consumer spending and oil demand. Chinese crude imports rose over 14% year-on-year in November, marking the first annual increase in seven months. U.S. crude and fuel stocks also grew, with crude inventories up by 499,000 barrels and gasoline stocks rising by 2.85 million barrels. Reports of potential U.S. sanctions on Russian oil exports added to market uncertainty as traders awaited official data from the U.S. Energy Information Administration.

OPEC+'s decision to delay oil supply revival until April has made options traders the most bearish in months. The move is expected to slow, but not prevent, price declines amid seasonally low demand in early 2024. Brent crude futures remain stuck in a $10-$15 trading range, with declining volatility as traders avoid big bets ahead of the holidays. Meanwhile, the U.S. natural gas "widowmaker" trade signals expectations of an oversupplied market at winter’s end. The USDA's latest supply-and-demand estimates have also put soybeans in the spotlight, drawing attention to potential shifts in agricultural markets.

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Oil prices rose over $1 today as the EU approved its 15th sanctions package against Russia, targeting its "shadow fleet" used to bypass price caps on seaborne crude. The sanctions aim to tighten global crude supplies, offsetting downward pressure from rising U.S. gasoline and distillate inventories. OPEC cut its oil demand growth forecasts for 2024 and 2025 for the fifth consecutive month, citing weak demand from China and increased non-OPEC+ supply. However, hopes for higher Chinese demand grew after Beijing announced plans for an "appropriately loose" monetary policy in 2025, marking its first easing in 14 years. The U.S. signaled potential new sanctions on Russian oil as Treasury Secretary Janet Yellen emphasized efforts to reduce Russia's oil revenue.