Valor | Energy Connection – Feb. 24, 2025

February 24, 2025 Edition

At Valor, our goal is to keep you informed of the latest news and updates from the oil and gas industry. We are committed to sharing the insights and knowledge that our team gathers to help you stay ahead in this dynamic sector. From mergers and acquisitions to regulatory changes and technological advancements, we cover all the key developments that impact the industry. Stay tuned for weekly updates to keep you well-informed.

• Oil dips on pending Kurdistan supply resumption
• Summary: Oil prices declined on Monday, extending last week’s losses, as markets anticipated the resumption of crude exports from Iraq’s Kurdistan region. Brent crude fell 20 cents to $74.23 per barrel, while WTI dropped 28 cents to $70.12 per barrel, following a $2 decline on Friday. Meanwhile, global supply concerns persist as the U.S. and Russia prepare for peace talks on Ukraine, with potential impacts on oil sanctions and seaborne shipments.
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1. BP to abandon green energy target and ramp up oil
2. Summary: BP will abandon its plan to expand renewable energy generation 20-fold by 2030, scrapping its target of reaching 50 gigawatts (GW) and maintaining its current 8.2 GW capacity. Under pressure from activist investor Elliott Management, which holds a 5% stake, BP is shifting focus back to fossil fuels, selling 10 U.S. onshore wind farms and spinning off offshore wind assets. The company’s profits fell to $8.2 billion in 2024 from $13.4 billion in 2023, prompting cost-cutting measures, a 5% staff reduction, and slashed executive bonuses.
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1. US oil and gas rig count hits highest since June, says Baker Hughes
2. Summary: U.S. oil and gas rigs rose by four to 592 this week, the highest since June, with oil rigs increasing by seven to 488, while gas rigs fell by two to 99, according to Baker Hughes. Despite the rise, the total rig count remains 34 rigs (5%) below last year’s level. The EIA forecasts U.S. crude output to grow from 13.2 million barrels per day (bpd) in 2024 to 13.6 million bpd in 2025, while gas production is expected to rise to 104.6 billion cubic feet per day (bcfd) in 2025.
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• 25% royalty rate cap on prime oil and gas land heads to the House
• Summary: The New Mexico Senate passed Senate Bill 23 in a 21-15 vote, advancing legislation to raise the maximum royalty rate on prime oil and gas land in the Permian Basin from 20% to 25%. Supporters argue the increase aligns with industry standards for high-value resources, while opponents claim it could harm an industry crucial to New Mexico’s economy. The State Land Office halted leasing top-tier tracts last year in anticipation of the rate hike, and the bill now moves to the House for further debate.
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• Feds approve another deepwater oil export terminal off Texas coast
• Summary: The U.S. government has approved the GulfLink deepwater oil export terminal off the Texas coast, marking another step in expanding American crude export infrastructure. The terminal will load up to 1 million barrels per day onto the world’s largest tankers, boosting U.S. energy exports. It is part of a broader buildout, including two new pipelines and a 319-acre tank farm. Supporters argue it enhances energy security and economic growth, while critics warn of increased greenhouse gas emissions—estimated at 355,000 to 710,000 tons annually—and potential environmental risks to coastal communities.
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1. U.S. crude oil inventories increase by 4.6 million barrels
2. Summary: U.S. crude oil inventories rose by 4.6 million barrels to 432.5 million barrels as of February 14, 2025, 3% below the five-year average, according to EIA data. Refinery inputs averaged 15.4 million barrels per day (bpd) at 84.9% capacity, while gasoline and distillate fuel production stood at 9.2 million bpd and 4.7 million bpd, respectively. Total petroleum inventories increased by 0.2 million barrels, with motor gasoline inventories down by 0.2 million barrels and distillate fuel inventories up by 2.1 million barrels, 12% below the five-year average.
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