Politics, Geopolitics & Conflict
– The fourth round of indirect nuclear negotiations between the U.S. and Iran, initially scheduled for May 3 in Rome, has been postponed. While Omani officials cited logistical reasons, Iranian authorities say the delay is due to Washington’s imposition of new sanctions targeting oil and petrochemicals during the negotiations, which Tehran has criticized as unconstructive. Things are about to get choppier with respect to these talks, as well, with Trump this week dismissing National Security Adviser Mike Waltz following a security breach that saw him add a journalist to a classified Signal chat that involved U.S. military plans. SoS Rubio has been appointed to replace him, giving him the role of both NSA and SoS (like Kissinger). This is all taking place against a backdrop of incidents in Iran that have not been fully investigated or explained. On April 26, a massive explosion occurred at the Shahid Rajaee port in Bandar Abbas, Iran’s largest maritime hub. The blast resulted in at least 70 deaths and hundreds of injuries. Preliminary investigations suggest that the explosion originated from containers containing rocket fuel chemicals. It remains unclear whether this incident was sabotage or negligence. Iranian media are blaming it on negligence; however, details are few and far between. Tehran has dismissed any speculation of sabotage or foreign meddling. Reports have emerged tying the heart of the explosion to a facility owned by a charitable foundation overseen by Supreme Leader Ayatollah Ali Khamenei’s office. The charitable foundation, Bonyad Mostazafan, is under U.S. sanctions for enriching Khamenei and for direct ties to Iran’s Revolutionary Guards forces. A second explosion on April 29 at the Avanar Parsian Chemical Industries warehouse in Isfahan Province led to two fatalities and two injuries. The facility is known for producing fireworks and industrial gunpowder, and an investigation is underway to determine the cause of the blast. Again–there is no talk from Iran of sabotage or foreign meddling.
– Syria’s new president, Ahmed al-Sharaa, is finding it a bit challenging to transition smoothly from rebel leader to formal leader of a post-Assad nation, and unrest is quickly getting out of control, particularly in the south. In the past week, the southern region has witnessed deadly clashes between the Druze community and forces aligned with the ruling Hay’at Tahrir al-Sham (HTS) coalition. This bout of violent unrest came about after an allegedly fabricated audio clip insulting the Prophet Muhammad was said to be falsely attributed to a Druze cleric. This led to retaliatory attacks in areas like Jaramana and Sahnaya, resulting in over 100 deaths, including civilians, Druze fighters, and HTS members. Israel, which (along with Turkey) has military operations in Syria, stepped in to support the Druze with airstrikes targeting what Israel said were extremist groups responsible for the violence. As we have noted previously, Turkey and Israel have conflicting agendas in Syria, where both are attempting to control the next rulers of the country. From a broader perspective, we are now witnessing a significant change in the regional balance of power in terms of external influence, with Russia and Iran weakened in Syria (but Russia regrouping in Libya and the wider Sahel) and Turkey gaining power and influence. On Friday, Israel’s Netanyahu said Israeli forces had struck a target near the presidential palace in the Syrian capital Damascus.
– The Saudis this week, via unnamed sources speaking to mainstream media, suggested that May 5th’s OPEC+ meet could bring a decision to ramp up output, with Riyadh indicating it can withstand low oil prices for some time. (Keep a close eye on Oilprice.com coverage of this early next week).
Deals, Mergers & Acquisitions
– Chevron’s proposed $53B acquisition of Hess Corporation is facing more legal challenges, with ExxonMobil now launching arbitration proceedings, asserting a right of first refusal over Hess’s stake in the coveted Stabroek block offshore Guyana. The International Chamber of Commerce (ICC) has scheduled a hearing for May 26 in London to address this dispute.
– Woodside Energy has entered into a long-term agreement with BP to supply up to 640 billion cubic feet of natural gas for its Louisiana LNG project. Deliveries are scheduled to begin in 2029. This is the first tranche of a diversified portfolio of feedgas that will support the Louisiana LNG project and connect up several basins and pipelines.
-VARO Energy has announced plans to acquire Preem, Sweden’s largest oil refiner. This acquisition will position VARO as Europe’s second-largest renewable fuel producer, significantly expanding its distribution and storage network across major European markets.
-QatarEnergy is in discussions with Japanese companies, including JERA and Mitsui & Co., for a long-term LNG supply agreement. The deal would involve the delivery of at least 3 million metric tons per annum, linked to Qatar’s North Field expansion project.
Discovery & Development
-TotalEnergies and Oman’s OQEP have commenced construction on the Marsa LNG project in Oman. A charter contract for a new LNG bunkering vessel has been signed by Marsa LNG, marking a significant step in the project’s development.
-ExxonMobil’s Yellowtail project (it’s 4th development in Guyana’s Stabroek Block) is on track for first production in Q3, expected to add some 250,000 bpd to Guyana’s output with the newly arrived ONE GUYANA FPSO vessel. Additionally, ExxonMobil has submitted a field development plan for the Hammerhead project, which is set to produce around 150,000 bpd starting in 2029, pending government approval. (We also note: Guyana’s Natural Resource Fund recorded $605.5 million in oil revenues for the first quarter of 2025, encompassing seven profit oil payments and one royalty payment. Despite increased production, revenues are projected to decline due to a forecasted 10.9% drop in oil prices).
-Rhino Resources (in partnership with Azule Energy, Namibian state-run NAMCOR, and Korres Investments) has announced a light oil discovery at the Capricornus 1-X well in Block 2914 (PEL 85) within Namibia’s Orange Basin. The well encountered a high-quality reservoir with 38 meters of net pay and no observed water contact. This marks Rhino’s second consecutive successful well in the region, following the Sagittarius 1-X discovery earlier this year.
Companies & Earnings
-A fatal accident took place this week at the Port Arthur LNG construction site in Texas, where a scaffolding collapse resulted in three fatalities and two injuries. Investigations are underway to determine the cause of the incident. Families of 2 of the 3 Houston men killed in the incident have filed a $1M lawsuit in the matter.
-On the earnings beat, this week has seen Q1 earnings deliver mixed signals but strong cash flows, with Shell coming in hot with $5.6B in Q1 adjusted earnings (lower YoY, but overtaking Wall Street expectations). Those adjusted earnings represent a 28% decline YoY, but beat expectations of $5 billion. (Down from $7.7 billion in the same period of 2024). Two things contributed to the downturn: A stellar 2024 to compare it with, and lower LNG production and prices. Despite this, Shell is still focusing on shareholders, announcing a $3.5 billion share buyback program for the next quarter (14th quarter in a row with buybacks over $3B). Shell also completed the acquisition of Singapore-based Pavilion Energy, aiming to bolster its Asia LNG portfolio. Shell is down 11% over the past 30 days.
-Equinor came in with adjusted operating income of $8.65B, also exceeding analyst expectations of $8.51 billion, and up from $7.53 billion the previous year. Higher European gas prices and solid operational efficiency were behind the performance, with Equinor holding fast to its 2025 capital expenditure forecast of $13B. It also maintains its expectation of a 4% increase in oil and gas output YoY (from 2024). Equinor plans to reward shareholders with $9 billion in dividends and share buybacks this year. Equinor is trading down over 16% for the last four weeks.
-EOG Resources reported $5.67B in revenue for Q1, representing a YoY decline of 7.4%. Adjusted earnings came in at $2.87/ share, exceeding analyst expectations of $2.79, with performance given a bump by a 63.4% YoY increase in nat gas prices and a 4.8% rise in total production to 98.1 MBoe. Still, the EOG trimmed its 2025 capital expenditure plan by $200 million, adjusting the range to $5.8 billion–$6.2 billion, citing trade war uncertainties. EOG is trading down over 14% in the past month.
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