A week unlike any other for crude prices

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A week unlike any other for crude prices

Oil, fundamental analysis The price of WTI settled last Friday at $90.90, which was already $14/bbl higher than the Friday before the US and Israel began their attacks on Iran. With the conflict continuing last weekend, Iran continued to pummel its neighboring petro-states and threatened any ships attempting to pass through the Strait of Hormuz. […]

Oil, fundamental analysis

The price of WTI settled last Friday at $90.90, which was already $14/bbl higher than the Friday before the US and Israel began their attacks on Iran. With the conflict continuing last weekend, Iran continued to pummel its neighboring petro-states and threatened any ships attempting to pass through the Strait of Hormuz. So, when the oil markets re-opened Sunday night, a lot of pent-up anxiety turned into the immediate buying of April NYMEX WTI futures with the Open price hitting $98/bbl leading to a session High of $119.50/bbl.

Trading Monday during regular business hours would moderate some ending in a closing price of $94.80/bbl but only after a wild day that saw a Low of $81.20 which created a daily Hi/Lo range of $32. The week’s Low was $76.75/bbl on Tuesday in what was seen at the time as numerous positive signs that the Strait of Hormuz would reopen. That didn’t happen. Brent crude followed a similar pattern hitting a High of $119.50/bbl on Sunday evening and a Low of $81.15 on Tuesday. Both contracts settled higher week-on-week. The WTI/Brent spread fluctuated throughout the week but now sits at ($4.80). Neither the International Energy Agency (IEA)-announced reserve release nor a gain in US crude inventories could halt the on-going rally.

The Strait of Hormuz remains the key issue impacting global oil prices as conflicting reports exist throughout the media coverage. President Trump said the US Navy would escort ships, if needed while Energy Secretary Wright stated that the US Navy was too involved in the actual conflict with Iran to perform such duties. Secretary of Defense Hegseth stated Friday that the Strait of Hormuz was “open” for ships wishing to pass unless Iran fires upon them which the latter has explicitly threatened to do. The US Central Command has requested that more ships be sent to the region for an escort service but don’t want to engage directly with Iran’s naval forces and IRGC boats. Any deployment could take at least a month to arrive.

France has indicated a willingness to send its navy to assist tankers passage but there are no reports yet that those vessels have arrived on scene. Iran has attacked and damaged 3 ships so far while the US Navy destroyed Iranian mine-laying boats in the area.

The exact amount of oil and natural gas (LNG) stranded in the area of the Strait varies from source to source. There could be as little as 10 million b/d sitting idle up to as much as 20 million b/d. But the IEA and its member nations have pledged to release about 400 million bbl from its collective reserves. Member countries are obligated by policy to store an amount of oil equivalent to its import needs for a 90-day period. As one of the members, the US will release 170 million bbl in an “exchange” arrangement where buyers now will sell back to the US down-the-road to replenish the supplies.

While the market initially reacted favorably to the announcement, the logistics will need to be worked out and the exact daily amount that can be delivered needs to be clarified.

Furthermore, estimating the Strait of Hormuz oil interruption on the high end at 20 million b/d, the IEA release would only cover 20 days if the volumes can be delivered at that same level.

The IEA is estimating that, in addition to the flow of oil out of the Persian Gulf, there has been an interruption of 8.0 million b/d of production. India struck a deal with the US to temporarily waive the sanctions on purchasing Russia oil to alleviate its supply shortages. And both India and China have reached out to Iran requesting safe passage of shipments of oil each has purchased in the region.

The Energy Information Administration’s (EIA) Weekly Petroleum Status Report indicated that commercial crude oil inventories for last week increased while production remained at 13.7 million b/d.

The SPR held at 415 million bbl.

Inflation for February increased 2.4% in line with market expectations. Personal income for January rose 0.4%, lower than the forecasted +0.5% while spending was +0.4%, above the forecasted +0.3%. Housing starts jumped +7.2% in January while the PCE, the Fed’s preferred measure of inflation, came in at 0.4% and +3.1% year-on-year. Durable goods sales for January were flat while analysts sought a +1.3% rise. Fourth-quarter 2025 consumer spending, which reflects holiday activity, was +2.0% vs. an expected +2.4%. The higher energy prices with no end in sight have hammered global economic markets. All three US stock indices are down again this week. The USD has strengthened but has not been able to put a cap on the buying of crude. Gold is down but still holding about the $5,000/oz. mark.

Oil, technical analysis

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Brent retreats from highs after Trump signals Iran war nearing end

@import url(‘https://fonts.googleapis.com/css2?family=Inter:[email protected]&display=swap’); a { color: var(–color-primary-main); } .ebm-page__main h1, .ebm-page__main h2, .ebm-page__main h3, .ebm-page__main h4, .ebm-page__main h5, .ebm-page__main h6 { font-family: Inter; } body { line-height: 150%; letter-spacing: 0.025em; font-family: Inter; } button, .ebm-button-wrapper { font-family: Inter; } .label-style { text-transform: uppercase; color: var(–color-grey); font-weight: 600; font-size: 0.75rem; } .caption-style { font-size: 0.75rem; opacity: .6; } #onetrust-pc-sdk [id*=btn-handler], #onetrust-pc-sdk [class*=btn-handler] { background-color: #c19a06 !important; border-color: #c19a06 !important; } #onetrust-policy a, #onetrust-pc-sdk a, #ot-pc-content a { color: #c19a06 !important; } #onetrust-consent-sdk #onetrust-pc-sdk .ot-active-menu { border-color: #c19a06 !important; } #onetrust-consent-sdk #onetrust-accept-btn-handler, #onetrust-banner-sdk #onetrust-reject-all-handler, #onetrust-consent-sdk #onetrust-pc-btn-handler.cookie-setting-link { background-color: #c19a06 !important; border-color: #c19a06 !important; } #onetrust-consent-sdk .onetrust-pc-btn-handler { color: #c19a06 !important; border-color: #c19a06 !important; } Oil futures eased from recent highs Tuesday as markets reacted to comments from US President Donald Trump suggesting the war with Iran may be nearing its conclusion, easing concerns about prolonged disruptions to Middle East crude supplies. Brent crude had climbed above $100/bbl amid escalating tensions in the region and fears that the war could prolong disruptions to shipments through the Strait of Hormuz—one of the world’s most critical energy chokepoints and a transit route for roughly one-fifth of global oil supply. Prices pulled back after Pres. Trump said the war was “almost done,” prompting traders to reassess the risk premium that had built into crude markets during the latest escalation. The earlier gains were driven by the fact that the war had disrupted tanker traffic in the Strait of Hormuz, raising concerns about wider supply disruptions from major Gulf oil producers. While the latest remarks helped calm markets, analysts note that geopolitical risks remain elevated and price volatility is likely to persist as traders monitor developments in the region. Any renewed escalation could quickly send crude prices higher again.

Southwest Arkansas lithium project moves toward FID with 10-year offtake deal

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Equinor makes oil and gas discoveries in the North Sea

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IEA launches record strategic oil release as Middle East war disrupts supply

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Infographic: Strait of Hormuz energy trade 2025

BOEM: US OCS holds 65.8 billion bbl of technically recoverable reserves

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Data mining? Old servers could become new source of rare earths

For decades, he said, “the retirement of data center equipment was treated almost entirely as a compliance and disposal issue. Enterprises focused on secure decommissioning, certified recycling, and documented destruction of sensitive hardware. Once equipment left production environments, its economic life was assumed to be largely finished.” That assumption, he pointed out, “is beginning to change, because the hardware inside modern data centres contains a wide range of strategically important materials. Servers, storage systems, networking equipment, and power components contain copper, aluminum, silver, gold, and increasingly small but significant quantities of rare earth elements and other critical minerals.” These materials play a vital role in the manufacturing of semiconductors, energy systems, defense electronics, and advanced computing infrastructure, he explained, noting, “as global demand for digital infrastructure continues to expand, the volume of retired hardware entering disposal channels is rising quickly.” Electronic waste has already become one of the fastest growing waste streams in the world. “Global volumes now exceed 60 million tonnes annually and are projected to move toward eighty million tonnes by the end of the decade if current trends continue,” he said. “Data center infrastructure represents only a portion of that total, but it is a particularly important portion because it is concentrated, professionally managed, and replaced in structured cycles.” For a metals producer, he said, data center infrastructure represents a highly attractive feedstock, because unlike consumer electronics, enterprise hardware is replaced in large batches and flows through professional asset management channels. That predictability, said Gogia, “allows recyclers to design specialized processes that target specific components and materials. Over time, this creates the foundation for an industrial scale circular supply chain in which retired electronics feed back into the production of new materials.”

Meta is developing more AI chips for itself

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Arista targets AI data centers with new liquid cooled pluggable optic module

To prove their point, the authors imagined a 400 MW AI datacenter with 1024 GPU racks of 128 GPUs each for a total of 128,000 GPUs. “Assume 12.8T scale-up and 1.6T scale-out bandwidth per GPU. With OSFP switch racks that have a density of 1.6 Pbps per rack, this would require more than 1,400 switch racks for scale-up and scale-out fabrics. With XPO, this would require 75% fewer racks, saving over 1,050 racks or 44 % of the floor space,” Bechtolsheim and Vusirikala stated in the blog. “Eliminating 75% of switch racks translates to massive reductions in construction and infrastructure costs, including power distribution, plumbing and installation costs, while accelerating deployment timelines,” Bechtolsheim and Vusirikala stated. Arista said the water-cooling capability of XPO is also an important feature. “All large AI data centers will be liquid cooled and the switches that go into these data centers also need to be liquid cooled,” Bechtolsheim and Vusirikala stated. “While one can add liquid cooled cold plates on flat-top OSFP modules, this does not substantially improve thermal performance.” XPO solves this problem by integrating a liquid cold plate inside the module, with two 32-channel paddle cards sharing the common cold plate which can cool both low power as well as high-power optics such as 8x1600G-ZR/ZR+ with up to 400W of power, Bechtolsheim and Vusirikala stated. XPO modules are much simpler than OSPF modules which improves reliability as well. “Each 32-channel paddle card has only one microcontroller and one set of voltage converters, a 75% reduction in common components versus 4 OSFPs,” Bechtolsheim and Vusirikala wrote.

Cisco grows high-end optical support for AI clusters

Cisco has also upgraded its Network Conversion System (NCS) with a 1RU, 800GE line card offering 12.8T capacity, with 32 OSFP-based ports for 100GE, 400GE, and 800GE clients and 800ZR/ZR+ WDM trunks. The NCS 1014 doubles the density of previous-generation NCS versions and now includes MACsec encryption (IEEE 802.1AE) to secure point-to-point links with hardware-based encryption, data integrity, and authentication for Ethernet traffic, Ghioni stated. It supports enhanced capacity and performance with C&L-band support and NCS 1014 systems with the 2.4T WDM line card based on the Coherent Interconnect Module 8 and now supports 800 GE clients, which can be mapped directly to a wavelength or inverse multiplexed across two wavelengths to maximize reach, Ghioni wrote. In the pluggable optic arena, Cisco is now offering a Quad Small Form Factor Pluggable Double Density (QSFP-DD) Pluggable Protection Switch Module that can monitor the optical link and switch traffic if it detects a fault in less than 50 milliseconds. The module occupies a quarter of the rack space compared to traditional protection devices—offering 90% rack space saving over available options, Ghioni wrote. It is aimed at Metro and DCI network customers where sub-50 ms failure recovery is essential and data centers needing fiber protection without bulky hardware, Ghioni stated. Cisco also added its Acacia developed Bright QSFP28 100ZR 0 dBm coherent optical pluggable in a standard QSFP28 form factor. It is aimed at edge, access, enterprise, and campus network deployment. Cisco has been actively growing its optical portfolio recently adding the Cisco Silicon One G300, which powers 102.4T N9000 and Cisco 8000 systems, as well as advanced 1.6T OSFP optics and 800G Linear Pluggable Optics.

Datalec targets rapid infrastructure deployment with new modular data centers

“We are engineering the data center with a new lens bringing pre-engineered system designs that are flexible and adaptable that enables a tailored solution for clients,” said John Lever, director of modular solutions at Datalec. The systems are flexible enough that these solutions cater for all types of data center, from standard server technology to AI and high-density compute. Datalec also provides “bolt-on” solutions, including a ‘digital wrapper’ including digital twinning and lifecycle and global support, Lever says. Another way Datalec says it differentiates from competing modular designs is a larger share of work is done offsite in a controlled manufacturing environment, which cuts onsite construction time, improves safety and limits disruption to live facilities, Lever says. The company competes with other modular data center vendors including Schneider Electric, Vertiv, Flex many others. DPI’s says its services are aimed at colocation providers, hyperscale and AI infrastructure teams, and large enterprises that need to add capacity quickly, safely and cost effectively across multiple regions.

Study finds significant savings from direct current power for AI workloads

The result is a 50% to 80% reduction in copper usage, due to fewer conductors and less parallel cabling, and an 8% to 12% reduction in annual energy-related OpEx through lower conversion and distribution losses. By reducing conductor count, cabling, and redundant power components, 800VDC enables meaningful savings at both build-out and operational stages. AI-first facilities can see a $4 million to $8 million in CapEx savings per 10 MW build by reducing upstream AC. For a one-gigawatt data center, you’re saving a couple million pounds of copper wire, he said. Burke says an all-DC data center is best done with a whole new facility rather than retrofitting old facilities. “[DC] is going to be in a lot of greenfield data centers that are going to be built, and data centers that are going to go to higher compute power are also going to DC,” he said. He did recommend all-DC retrofits for existing data centers that are going to employ high power computing with GPUs. Enteligent’s unnamed and as yet unreleased product is a converter that takes 800 volts and partitions it to 50 volts for the computing servers. The company will provide a new power supply, power shelf that converts 800 volts DC to 50 volts DC much more efficiently than any current power supplies. Burke said the company is doing NDA level testing and pilot programs now with its product, but it will be making a formal announcement within the next few weeks. There are a number of players in the DC arena focusing on different parts of the power supply market including Vertiv, Rutherford, Siemens, Eaton and many more.

Microsoft will invest $80B in AI data centers in fiscal 2025

And Microsoft isn’t the only one that is ramping up its investments into AI-enabled data centers. Rival cloud service providers are all investing in either upgrading or opening new data centers to capture a larger chunk of business from developers and users of large language models (LLMs). In a report published in October 2024, Bloomberg Intelligence estimated that demand for generative AI would push Microsoft, AWS, Google, Oracle, Meta, and Apple would between them devote $200 billion to capex in 2025, up from $110 billion in 2023. Microsoft is one of the biggest spenders, followed closely by Google and AWS, Bloomberg Intelligence said. Its estimate of Microsoft’s capital spending on AI, at $62.4 billion for calendar 2025, is lower than Smith’s claim that the company will invest $80 billion in the fiscal year to June 30, 2025. Both figures, though, are way higher than Microsoft’s 2020 capital expenditure of “just” $17.6 billion. The majority of the increased spending is tied to cloud services and the expansion of AI infrastructure needed to provide compute capacity for OpenAI workloads. Separately, last October Amazon CEO Andy Jassy said his company planned total capex spend of $75 billion in 2024 and even more in 2025, with much of it going to AWS, its cloud computing division.

John Deere unveils more autonomous farm machines to address skill labor shortage

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More Self-driving tractors might be the path to self-driving cars. John Deere has revealed a new line of autonomous machines and tech across agriculture, construction and commercial landscaping. The Moline, Illinois-based John Deere has been in business for 187 years, yet it’s been a regular as a non-tech company showing off technology at the big tech trade show in Las Vegas and is back at CES 2025 with more autonomous tractors and other vehicles. This is not something we usually cover, but John Deere has a lot of data that is interesting in the big picture of tech. The message from the company is that there aren’t enough skilled farm laborers to do the work that its customers need. It’s been a challenge for most of the last two decades, said Jahmy Hindman, CTO at John Deere, in a briefing. Much of the tech will come this fall and after that. He noted that the average farmer in the U.S. is over 58 and works 12 to 18 hours a day to grow food for us. And he said the American Farm Bureau Federation estimates there are roughly 2.4 million farm jobs that need to be filled annually; and the agricultural work force continues to shrink. (This is my hint to the anti-immigration crowd). John Deere’s autonomous 9RX Tractor. Farmers can oversee it using an app. While each of these industries experiences their own set of challenges, a commonality across all is skilled labor availability. In construction, about 80% percent of contractors struggle to find skilled labor. And in commercial landscaping, 86% of landscaping business owners can’t find labor to fill open positions, he said. “They have to figure out how to do

2025 playbook for enterprise AI success, from agents to evals

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More 2025 is poised to be a pivotal year for enterprise AI. The past year has seen rapid innovation, and this year will see the same. This has made it more critical than ever to revisit your AI strategy to stay competitive and create value for your customers. From scaling AI agents to optimizing costs, here are the five critical areas enterprises should prioritize for their AI strategy this year. 1. Agents: the next generation of automation AI agents are no longer theoretical. In 2025, they’re indispensable tools for enterprises looking to streamline operations and enhance customer interactions. Unlike traditional software, agents powered by large language models (LLMs) can make nuanced decisions, navigate complex multi-step tasks, and integrate seamlessly with tools and APIs. At the start of 2024, agents were not ready for prime time, making frustrating mistakes like hallucinating URLs. They started getting better as frontier large language models themselves improved. “Let me put it this way,” said Sam Witteveen, cofounder of Red Dragon, a company that develops agents for companies, and that recently reviewed the 48 agents it built last year. “Interestingly, the ones that we built at the start of the year, a lot of those worked way better at the end of the year just because the models got better.” Witteveen shared this in the video podcast we filmed to discuss these five big trends in detail. Models are getting better and hallucinating less, and they’re also being trained to do agentic tasks. Another feature that the model providers are researching is a way to use the LLM as a judge, and as models get cheaper (something we’ll cover below), companies can use three or more models to

OpenAI’s red teaming innovations define new essentials for security leaders in the AI era

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More OpenAI has taken a more aggressive approach to red teaming than its AI competitors, demonstrating its security teams’ advanced capabilities in two areas: multi-step reinforcement and external red teaming. OpenAI recently released two papers that set a new competitive standard for improving the quality, reliability and safety of AI models in these two techniques and more. The first paper, “OpenAI’s Approach to External Red Teaming for AI Models and Systems,” reports that specialized teams outside the company have proven effective in uncovering vulnerabilities that might otherwise have made it into a released model because in-house testing techniques may have missed them. In the second paper, “Diverse and Effective Red Teaming with Auto-Generated Rewards and Multi-Step Reinforcement Learning,” OpenAI introduces an automated framework that relies on iterative reinforcement learning to generate a broad spectrum of novel, wide-ranging attacks. Going all-in on red teaming pays practical, competitive dividends It’s encouraging to see competitive intensity in red teaming growing among AI companies. When Anthropic released its AI red team guidelines in June of last year, it joined AI providers including Google, Microsoft, Nvidia, OpenAI, and even the U.S.’s National Institute of Standards and Technology (NIST), which all had released red teaming frameworks. Investing heavily in red teaming yields tangible benefits for security leaders in any organization. OpenAI’s paper on external red teaming provides a detailed analysis of how the company strives to create specialized external teams that include cybersecurity and subject matter experts. The goal is to see if knowledgeable external teams can defeat models’ security perimeters and find gaps in their security, biases and controls that prompt-based testing couldn’t find. What makes OpenAI’s recent papers noteworthy is how well they define using human-in-the-middle

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