A flotilla of crude oil on the world’s oceans expanded to a fresh high as producer nations keep adding barrels and the tankers sail further for deliveries. A total of 1.24 billion barrels of crude and condensate, a light form of oil recovered from gas fields, was moving on tankers in the week to Oct. 17, according to data from analytics firm Vortexa. That was up from a revised 1.22 billion barrels a week earlier.  Oil traders warned last week that a long-anticipated surplus is finally starting to materialize and the amount of cargo at sea is one indicator of that.  Production is rising from members of the OPEC+ group of nations, which are unwinding earlier output cuts — as well as countries outside the group, predominantly in the Americas, where Guyana recently started pumping from a new offshore field and US output hit a new high. The build-up comes at a time when demand growth is slowing, with forecasters predicting a surplus that could rise to as much as 4 million barrels a day in the early months of next year. Oil prices fell 0.8% on Monday, taking their decline so far this year to 18%. Eight members of the Organization of the Petroleum Exporting Countries and their allies, which together make up the OPEC+ grouping, raised their collective production target by almost 2.5 million barrels a day between March and September. While increases in actual production have lagged, the group still added more than 2 million barrels a day to supply over that period. Vortexa’s figures exclude oil in floating storage, defined as being on vessels that have been stationary for at least seven days. The biggest increases have come from Saudi Arabia, the United Arab Emirates and Russia, whose combined output has risen by 1.77 million barrels a day.

In an EBW Analytics Group report sent to Rigzone by the EBW team on Monday, Eli Rubin, an energy analyst at the company, noted that a “bullish weather shift spark[ed]… [a] natural gas revival”. “After testing as low as $2.893 per million British thermal units (MMBtu) intraday Friday – and with weekend Henry Hub spot prices falling to $2.66 [per MMBtu] – a cooler weekend weather shift has revived bullish fortunes for the November contract,” Rubin said in the report. “Further, weekly average LNG was at a record high over the weekend and natural gas production readings slumped in the Permian and Marcellus,” Rubin added. In the report, Rubin noted that “some meteorologists reflect a larger heating demand gain, helping to explain the pop at the front of the curve”. “Cooler weather (the next three EIA [U.S. Energy Information Administration] weeks are expected to be below long-term normals) slashes risks of bearish outcomes akin to early November 2024,” Rubin said. The energy analyst stated in the report that “shorts covering some positions likely underlies the market reaction higher”. “Still, lofty storage, mild weather, and returning production remain,” Rubin warned in the report. “The $3.22-3.24 per MMBtu level is a key technical battleground, however, and if weather models continue colder or bulls lift November above key resistance, extended near-term upside potential may occur,” he added. EBW’s report highlighted that the November natural gas contract closed at $3.008 per MMBtu on Friday. This was up 7.0 cents, or 2.4 percent, from Thursday’s close, the report outlined. In a separate EBW report sent to Rigzone by the EBW team on Friday, Rubin warned that “near to medium term natural gas weakness extend[ed]”. “Yesterday’s [Thursday] EIA-reported 80 billion cubic foot injection confirmed a lofty storage trajectory, driving the November 2025 natural gas contract to

Is the oil and gas market currently in a bust cycle? That’s the question Rigzone asked James Davis, Director of Short-Term Global Oil Service and Head of Upstream Oil at FGE London, in an exclusive interview recently. In response, Davis told Rigzone, “crude oil prices have fallen year on year, and as the supply surplus continues, as evidenced by reported stockbuilds, prices will fall further”. “We’re already seeing evidence of oil companies cutting investment as a result of lower prices,” he added. “If these are the qualities of what you want to call a bust cycle, then, we’re in a bust cycle,” he said. In the interview, Davis highlighted to Rigzone that, for producers, $60 per barrel oil today doesn’t go as far as it did back in 2019. “For the average tight oil producer, $60 per barrel today gives you very little free cash flow,” he said. “However, in 2019, the average tight oil producer might have realized $10-15 per barrel of free cash flow at $60 per barrel,” he added. “While operating expenditure and capital expenditure have crept up, it is weaker gas prices that have had the biggest impact on cost exposure,” Davis pointed out. “Nonetheless operating margins are not as good at the current price deck as they would have been six years ago,” he noted. When asked if this bust cycle is going to negatively affect future production, Davis told Rigzone that FGE is already seeing evidence that the low oil price environment is impacting oil output, particularly in the United States. “While low cost producers (oil majors and international oil companies) have managed to grow output this year, the smaller, high cost producers have seen their output slump by around 200-300,000 barrels per day,” he said. “We expect more declines from high cost producers

JERA Co Inc and the Hawaiian government have signed a collaboration agreement “focusing on fuel diversity and developing pathways toward decarbonization”, the Japanese integrated power company said. The “strategic partnering agreement” between JERA and the governor’s office “is designed to help realize the Hawai’i State Energy Office’s ‘Alternative Fuels, Repowering and Energy Transition Study’, published in January 2025, which concluded in the short term that the state should accelerate its shift away from oil by using affordable and reliable alternative fuels, including natural gas”, JERA said in a statement on its website. Governor Josh Green said in the statement, “By collaborating with JERA – Japan’s largest power producer and a recognized global leader in energy transition – we are gaining access to valuable expertise and experience that will help accelerate our decarbonization journey while improving reliability and affordability for our residents”. JERA global chief executive Yukio Kani said, “As island communities, Japan and Hawai’i share similar challenges and opportunities in pursuing affordability, stability and sustainability. By working together, we aim to develop practical, innovative solutions that strengthen energy resilience and reduce costs for the people of Hawai’i”. The company added, “JERA brings extensive experience in the development and operation of large-scale, reliable energy infrastructure worldwide, with a growing focus on low-carbon fuels, hydrogen, ammonia and renewable energy integration”. In the study by the Hawai’i State Energy Office (HSEO), the agency proposed a new power plant that would run on natural gas supplied by a floating storage regasification unit. “LNG emerged as the near-term fuel with the potential to cost-effectively reduce the state’s greenhouse gas emissions during the transition to economywide decarbonization in 2045, but more analysis is needed to quantify a range of potential benefits and to identify how those benefits can be maximized to residents at the appropriate level of infrastructure buildout”,

The United States Department of Energy (DOE) has awarded a $1.6-billion loan guarantee for projects by American Electric Power Co Inc (AEP) to upgrade nearly 5,000 miles of transmission lines across five states. The projects cover Indiana, Michigan, Ohio, Oklahoma, and West Virginia. “The upgrades supported by this financing will replace existing transmission lines in existing rights-of-way with new lines capable of carrying more energy”, AEP said in a press release. “Energy demand is increasing across AEP’s footprint. Customers have committed to business expansions or additions that will require an additional 24 gigawatts of electricity demand by the end of the decade”, the Columbus, Ohio-based company said. “The upgrades have primarily been identified to support data center, artificial intelligence and manufacturing development and represent generational load growth on the electric system. “Seeking federal funding opportunities and implementing rate structures that ensure new large customers are supporting infrastructure investment are some of the ways AEP is working to reduce rate impacts for customers”. It estimates the projects to save customers $275 million in financing costs over the life of the loan through lower bills. “Approximately 100 miles of transmission lines across Ohio and Oklahoma are the first projects to be supported by the loan guarantee”, AEP said. This is “the first closed loan guarantee under the Energy Dominance Financing (EDF) Program created by the Working Families Tax Cut, also known as the One Big Beautiful Bill Act”, DOE said separately. “All electric utilities receiving an EDF loan must provide assurance to DOE that financial benefits from the financing will be passed onto the customers of that utility”, DOE added. The AEP guarantee “was carefully evaluated under the new LPO [Loan Programs Office] guidance directed by Secretary Wright”, DOE added. Funding Cancelations Days earlier, DOE announced it had terminated nearly 350 financial

Brent crude is set to dip its feet into the high $50ies per barrel this week, Skandinaviska Enskilda Banken AB (SEB) Chief Commodities Analyst Bjarne Schieldrop warned in a SEB report sent to Rigzone on Monday.   “Brent crude fell 2.3 percent over the week to Friday,” Schieldrop highlighted in the report. “It closed the week at $61.29 per barrel, a slight gain on the day, but also traded to a low of $60.14 per barrel that same day and just barely avoided trading into the $50ies per barrel,” he added. “This week looks set for Brent crude to dip its feet in the $50ies per barrel,” he continued. In the report, Schieldrop said front-end backwardation has been on a weakening foot and warned that “it is now about to fully disappear”.  “The lowest point of the crude oil curve has also moved steadily lower and lower and its discount to the five year contract is now $6.8 per barrel – a solid contango,” he noted. “The Brent three month contract did actually dip into the $50ies per barrel intraday on Friday when it traded to a low point of $59.93 per barrel,” he added. Schieldrop went on to warn in the report that more weakness is to come “as lots of oil at sea comes to ports”. “Mid-East OPEC countries have boosted exports along with lower post summer consumption and higher production,” he said. “The result is highly visibly in oil at sea which increased by 17 million barrels to 1,311 million barrels over the week to Sunday. Up 185 million barrels since mid-August. On its way to discharge at a port somewhere over the coming month or two,” he added. Schieldrop noted in the report that the oil market path ahead “is all down to OPEC+”. “Remember that what is playing