Iran's Oil Return Would Be Modest, Even With a Deal
In the latest edition of the Numbers Report, we will take a look at some of the most interesting figures put out this week in the energy and metals sectors. Each week we’ll dig into some data and provide a bit of explanation on what drives the numbers.
Let’s take a look.
IEA and OPEC Become the Two Extremes of the Oil Market
- The analytical rivalry between OPEC and IEA is intensifying, with the former keeping its 2025 demand forecast intact (despite trade war concerns) and cutting its supply outlook instead, trimming 100,000 b/d from US supply.
- The International Energy Agency, in its turn, drastically hiked its 2025 global supply growth numbers, boosting it by 380,000 b/d from a month ago to a total of 1.6 million b/d, citing higher-than-assumed OPEC+ growth.
- OPEC predicts demand growth this year to be at 1.3 million b/d, almost double of the IEA’s 740,000 b/d forecast, with both agencies extending their current consumption growth rates to 2026 as well.
- The IEA has also been retrospectively ramping up demand numbers for previous years, lifting its 2023 demand number by 330,000 b/d some 17 months after the year ended, raising concerns about the accuracy of such forecasts.
Iran’s Potential Nuclear Deal Not a Worry for Oil Markets
- This week’s oil price developments have been mostly determined by President Trump’s statements on a potential nuclear deal with Iran, saying Tehran has ‘sort of agreed to the terms of a deal’…
In the latest edition of the Numbers Report, we will take a look at some of the most interesting figures put out this week in the energy and metals sectors. Each week we’ll dig into some data and provide a bit of explanation on what drives the numbers.
Let’s take a look.
- IEA and OPEC Become the Two Extremes of the Oil Market
- The analytical rivalry between OPEC and IEA is intensifying, with the former keeping its 2025 demand forecast intact (despite trade war concerns) and cutting its supply outlook instead, trimming 100,000 b/d from US supply.
- The International Energy Agency, in its turn, drastically hiked its 2025 global supply growth numbers, boosting it by 380,000 b/d from a month ago to a total of 1.6 million b/d, citing higher-than-assumed OPEC+ growth.
- OPEC predicts demand growth this year to be at 1.3 million b/d, almost double of the IEA’s 740,000 b/d forecast, with both agencies extending their current consumption growth rates to 2026 as well.
- The IEA has also been retrospectively ramping up demand numbers for previous years, lifting its 2023 demand number by 330,000 b/d some 17 months after the year ended, raising concerns about the accuracy of such forecasts.
- Iran’s Potential Nuclear Deal Not a Worry for Oil Markets
- This week’s oil price developments have been mostly determined by President Trump’s statements on a potential nuclear deal with Iran, saying Tehran has ‘sort of agreed to the terms of a deal’ to get rid of its stockpiles of enriched uranium.
- Despite several rounds of US sanctions in a drive labelled ‘maximum pressure on Tehran’, Iranian exports have been flat across 2025 with outflows averaging 1.6 million b/d over the course of January-April.
- Now that the US Department of Treasury has started to sanction respective Chinese teapot refiners, many of them have no other means of procuring crude other than Iranian, even if discounts aren’t really steep and delivered prices hover around a -$2 per barrel discount to Brent.
- The IEA believes that if a US-Iran nuclear deal is struck, Tehran wields approximately 300,000-400,000 b/d of spare capacity, suggesting that any incremental volumes coming out of the country would be relatively minor.
- Indian Refiners Mull Risks of Potential Pakistan Conflagration
- The prospect of an India-Pakistan military conflict has been looming large for South Asian refiners, particularly in a period when India’s demand growth is surpassing China’s in both absolute and relative numbers.
- India’s demand for refined products is expected to rise 3% or 150,000 b/d year-over-year to 5.6 million b/d, mostly driven by diesel and gasoline as experts doubt that tensions in Kashmir will restrict people’s travel plans.
- Approximately 45% of India’s refining capacity is located in the border states of Gujarat, Punjab and Rajasthan, with India’s next big downstream project – the 180,000 b/d Barmer refinery – located some 50 miles from the Pakistani border.
- Whilst India exports some 1.2 million b/d of its refined products abroad, mostly diesel to adjacent Asian countries and Eastern Africa, Pakistan has a relatively small downstream clout with refinery runs hardly touching 200,000 b/d.
- Canada’s Oil Sands Become the New M&A Mayhem
- While the US oil industry is waiting for the resolution of the Chevron-ExxonMobil spat regarding Hess Energy’s Guyanese assets, Canada is now facing its own high-stakes M&A drama.
- Canada’s eighth largest producer Strathcona Resources, managed by oil tycoon Adam Waterous, will be formally making a $4.25 billion hostile takeover plan for rival MEG Energy, with the all-cash-and-stock offer to be filed over the next two weeks.
- The announcement comes on the same day that Strathcona announced the divestment of $2.8 billion worth of assets in the Montney shale formation of Alberta, seeking to become a purely heavy oil-focused producer.
- MEG Energy’s 100,000 b/d Christina Lake producing asset will team up with Strathcona’s own output of roughly 120,000 b/d (excluding divested Montney assets), however the deal is not guaranteed to be a success as MEG’s chairman has previously stated they’re not interested.
- With Gasoline Sorted, Does Trump Now Have a Power Price Problem?
- According to analysis made by the EIA, retail electricity prices have been rising faster than the nominal rate of inflation since 2022, a trend that is bound to continue with 2025 levels some 13% above the 2022 baseline.
- The report singles out the Pacific, Middle Atlantic and New England as particularly susceptible to higher-than-average electricity price rallies, with the former potentially seeing prices nearing $0.3 per KWh, double the rate of Texas.
- US consumers spent an average of $1,760 on electricity expenditures in 2023, surpassed only by gasoline ($2,450) in terms of fuel-related expenses, with power exhibiting much less volatility than more oil-dependent gasoline prices.
- US electricity prices have been mostly stagnant in the 2010s, growing by only 7% between 2010 and 2019, however have been rising at an average rate of 4.5% in the 2020s as the proliferation of renewables put regional energy balances in disarray.
- The US-Saudi Energy Partnership That Wasn’t
- President Trump’s visit to Saudi Arabia was surprisingly light on new giant oil & gas deals, with $142 billion worth of defence investments taking pole position amongst Riyadh’s priorities as Mohammed bin Salman unveiled a $600 billion investment package in the United States.
- A little more than 20 years ago, Saudi Arabia was a leading supplier of crude to the American market with US imports peaking at 2.2 million b/d in 2003, a flow which by now has dried up to a mere 275,000 b/d last year.
- Saudi Aramco still announced a $3.4 billion investment into its wholly owned Motiva refinery in Port Arthur, TX, however it is an open-ended question whether the Saudi national oil company would have spent that money on the plant regardless of Trump’s visit.
- Saudi Arabia’s push to expedite OPEC+ production cuts has nevertheless been a great boon to Trump’s first days in office, capping US inflation and lowering gasoline prices, with market speculation expecting the US to ratchet up pressure on Iran to offset higher Saudi output.
- When One Needs It the Most, Tungsten Becomes Super Expensive
- China’s tightening grip on critical mineral supply across the world continues to lift prices, with tungsten prices in Europe now trading at their highest level since 2013 and the rally is far from over.
- Tungsten, usually used as a hardening element in steel, aerospace equipment and armaments, has been one of the five strategic metals that Beijing subjected to strict export restrictions, sending the price of ammonium paratungstate (APT) above $400 per metric tonne.
- China dominates global tungsten production, producing more than 80% of last year’s total output of 81,000 metric tonnes, however, Beijing keeps on tightening its tungsten ore mining quota by an annual 6%.
- The metal market’s first reaction to Chinese export curbs was to garner all possible scrap supplies; however, scrap inventories are running thin, a situation aggravated by the US’s 2027 deadline to eliminate tungsten purchases from China and Russia (the two largest producers) by 2027.
That’s it for this week’s Numbers Report. Thanks for reading, and we’ll see you next week.