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<ul class="summary-list"><li>The oil market could see a surplus of one million barrels of crude a day in 2025, the IEA forecast.</li><li>The excess will be driven by low demand in China and booming output from non-OPEC countries.</li></ul>The oil market could see a major supply glut in 2025 thanks to <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/us-oil-opec-crude-production-record-oil-prices-commodity-market-2024-11">booming production</a> from non-OPEC states like the US and sagging demand in <a target="_blank" class="" href="https://www.businessinsider.com/oil-price-today-middle-east-israel-hezbollah-conflict-china-economy-2024-10">China</a>, according to the International Energy Agency.The IEA said in its November Oil Market Report that the world's oil market is on track for a one-million barrel-a-day surplus next year.The excess is largely being driven by a weakening economy in China. Demand for oil in the world's second-largest economy contracted for six straight months in a row as of September, IEA data shows. This accounted for the "main drag" on demand this year, the report said.Meanwhile, the agency is predicting strong oil production among non-OPEC producers led by countries like <a target="_blank" href="https://markets.businessinsider.com/news/commodities/us-oil-opec-crude-production-record-oil-prices-commodity-market-2024-11">US</a>, <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/oil-outlook-brazil-guyana-record-american-opec-market-share-saudi-2023-12">Guyana</a>, Argentina, and Brazil.Altogether, non-OPEC producers are on track to expand oil production by 1.5 million barrels a day, it estimated. That amount is more than the agency's forecast for world oil consumption to grow by 990,000 barrels a day next year.OPEC+, the oil cartel led by Saudi Arabia, has also said it will unwind its 2.2 million barrel-a-day <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/crude-oil-outlook-opec-production-markets-saudi-arabia-russia-economy-2023-12">production cuts</a>, which have put pressure on supply over the past few years. The group could start lifting its production quota as soon as January, per its latest announcement. "Our current balances suggest that even if the OPEC+ cuts remain in place, global supply exceeds demand by more than 1 mb/d next year. With supply risks omnipresent, a looser balance would provide some much-needed stability to a market upended by the Covid pandemic, Russia's full-scale invasion of Ukraine and, most recently, heightened unrest in the Middle East," the IEA added.The US has become the <a target="_blank" class="" href="https://www.eia.gov/todayinenergy/detail.php?id=61545">largest oil producer</a> in the world, pumping out more crude than any other country in history for the last six years in a row, according to the US Energy Information Administration. Domestic production hit a record 13.4 million barrels a day in August, according to data from the Energy Information Administration.

China's weak economy and record US production will lead to a surplus of one million barrels of oil a day next year, IEA says

<ul class="summary-list"><li>Trump's presidency may pressure Russia's oil and gas industry.</li><li>The EU is thinking about replacing Russian LNG with US shipments, potentially affecting trade dynamics.</li></ul>Russia's lucrative oil and gas industry could come under greater pressure when US President-elect Donald Trump takes office.Domestically, Trump is championing the US oil and gas industry and encouraging production — which is likely to underscore America's position as an oil and gas giant.Meanwhile, the European Union said it could consider buying more US liquefied natural gas in a deal with Trump that would address a trade deficit. The EU doesn't have to burn bridges to negotiate with Trump, because the bloc still imports LNG from Russia."We still get a lot of LNG from Russia, and why not replace it with American LNG, which is cheaper for us and brings down our energy prices," European Commission President Ursula von der Leyen told reporters on Friday."It's something where we can get into a discussion," she said, referring to US's trade deficit with the eurozone, which reached <a target="_blank" class="" href="https://ustr.gov/countries-regions/europe-middle-east/europe/european-union">$131.3 billion in 2022.</a>To be sure, it's ultimately up to EU importers to decide where to import energy supplies based on market conditions.However, at least one EU country — <a target="_blank" class="" href="https://www.ft.com/content/d23591fc-0463-4346-865c-0e851a256ed2">Belgium</a> — is calling on the bloc to ban Russian LNG imports to further squeeze Moscow's war chest.The EU — which previously relied on Russian energy — banned seaborne Russian crude imports and refined petroleum products following the full-scale invasion of Ukraine in February 2022.The EU has also cut most of its piped natural gas imports from Russia, replacing much of it with LNG from the US — which is now a top exporter of the fuel to Europe, accounting for <a target="_blank" class="" href="https://energy.ec.europa.eu/topics/carbon-management-and-fossil-fuels/liquefied-natural-gas_en">46% of the bloc's supply in 2023.</a>Russia accounts for 8% of the EU's LNG imports. Other major LNG exporters to the EU include Qatar and Algeria."It would be in the interest of the US that Europe continues to shun Russian fossil fuels, given the US oil and gas industry has been one of the key beneficiaries of this move," wrote Warren Patterson, the head of commodities strategy at <a target="_blank" class="" href="https://think.ing.com/articles/what-a-trump-presidency-means-for-oil-and-gas-markets/">ING,</a> on Friday.<h2 id="e98e057f-427c-49fe-80b4-6b3536753369">'Drill, baby, drill'</h2>Trump's victory could shake up the highly politicized energy industry as he has made it clear that he supports oil production."I make this pledge to the great people of America: I will end the devastating inflation crisis immediately, bring down interest rates, and lower the cost of energy," Trump said in his Republican National Convention speech in July."We will drill, baby, drill," Trump said.While Trump's pledges to loosen energy regulations in the US are seen as a boost to the industry, it could increase oil supplies — a negative for prices.For consumers, lower energy prices translate to lower pump prices and electricity bills.However, it would also pressure energy company profits and, in turn, discourage more production — which is at record levels in the US.But there could also be other moving parts in Trump's second term, including potential sanctions on oil supplies from Iran, Venezuela, and Russia — all of which could tighten global supplies and support prices.Even before Trump's second election, there are so many uncertainties surrounding the geopolitical economy of energy that <a target="_blank" class="" href="https://www.businessinsider.com/major-oil-producers-saudi-arabia-russia-diversify-economies-opec-shale-2024-10">Saudi Arabia and Russia,</a> two of the largest oil producers, are trying to diversify their economies.In the meantime, the broad energy market is taking a wait-and-see stance."Initial market reactions have been muted to Trump's election victory, but in the medium term, he is expected to reinforce the US' role as a leading oil and LNG exporter," wrote Kaushal Ramesh, the head of gas and LNG analytics at Rystad Energy research firm on Monday.

Russia's lucrative oil and oil industry is an easy target for Europe after Trump's election victory

Mumbai: The rupee slipped 1 paisa to an all-time low of 84.40 against the US dollar in early trade on Wednesday, as persistent <keyword id="20520117" type="General" weightage="20" keywordseo="foreign-fund-outflows" source="keywords">foreign fund outflows</keyword> and a muted trend in domestic equities weighed on the local unit. Forex traders said the USDINR pair has shown significant volatility in recent sessions, with the rupee inching closer to its all-time low of 84.40. This downward pressure is largely driven by global factors, particularly the Dollar Index's strengthening. At the interbank foreign exchange, the rupee opened at 84.40 against the greenback, registering a fall of 1 paisa over its previous close. On Tuesday, the rupee fell 1 paisa to a new lifetime low of 84.39 against the US dollar. "It appears that the rupee has established support around the current levels, with depreciation limited near 84.50," CR Forex Advisors MD Amit Pabari said. Pabari further added that the RBI stands tall as the depreciation in the rupee seems to be limited as the <keyword id="19899810" type="General" weightage="100" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="261" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword> (RBI) continues to sell the dollars to protect the sharp depreciation. "For the 5th consecutive week, India's forex reserves declined, possibly due to RBI selling the dollars. Currently, the forex reserves of India stand at USD 682 billion down from the recent all-time high of USD 704 billion," he said. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading lower by 0.04 per cent at 105.98. Brent crude, the global oil benchmark, rose 0.25 per cent to USD 72.07 per barrel in futures trade. On the domestic equity market front, Sensex was trading 210.66 points, or 0.27 per cent lower, to 78,464.52 points. The Nifty fell 100.45 points, or 0.42 per cent, to 23,783.00 points. Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Tuesday, as they offloaded shares worth Rs 3,024.31 crore, according to exchange data. On the macroeconomic front, retail inflation breached the Reserve Bank's upper tolerance level, soaring to a 14-month high of 6.21 per cent in October mainly on account of rising food prices. Inflation based on the consumer price index (CPI) was 5.49 per cent in September and 4.87 per cent in the year-ago month. India's industrial production expanded by 3.1 per cent in September after recording a contraction in the preceding month, as all three major segments -- mining, manufacturing, and power generation -- showed improvement. However, the growth in the Index of Industrial Production (IIP) during the month was lower than 6.4 per cent registered in September 2023.

Rupee falls 1 paisa to all-time low of 84.40 against US dollar in early trade

<ul class="summary-list"><li>Oil prices ended down 7% last week and are lower this year-to-date, despite Middle East tensions.</li><li>China's economic downturn, the US shale boom, and clean energy are contributing to current oil price trends.</li></ul>The oil markets aren't what they used to be, and two of the world's biggest producers of the commodity are feeling the pressure.Oil prices have been depressed this year because <a target="_blank" class="" href="https://www.businessinsider.com/oil-price-today-middle-east-israel-hezbollah-conflict-china-economy-2024-10">China</a> — the world's largest oil importer — is in a prolonged economic downturn. The US' massive boom in oil production over the last 15 years has also kept prices low.Now, Saudi Arabia and Russia are both trying to diversify their economies away from energy, which makes up about 40% and 20% of their GDP, respectively.With the shift, Saudi Arabia and Russia are trying to create new economic engines that can sustain the country for decades, Abishur Prakash, the founder of The Geopolitical Business, a strategy advisory firm in Toronto, told Business Insider.The existential reorientation comes amid what Prakash terms a "geopolitical misalignment," even in the face of a potential supply disruption."The reality is that Middle Eastern oil supplies are in the bull's-eye of geopolitics. A potential back-and-forth between Israel and Iran, which is increasingly likely, will draw in the region's energy ecosystem," he said.But this year, markets have largely shrugged off supply concerns stemming from the Middle East conflict — a break from history, when regional problems sent prices higher.<h2 id="45bcbf13-524d-48a5-aa00-144efa7dd75c">Moving away from oil</h2><a target="_blank" href="https://www.eia.gov/tools/faqs/faq.php?id=709&amp;t=6.">Saudi Arabia and Russia</a> tied for the world's second-largest oil producer after the US. Last year, they each accounted for 11% of the world's oil supply.While Saudi Arabia and Russia are still the world's top oil exporters, the <a target="_blank" class="" href="https://www.eia.gov/todayinenergy/detail.php?id=61584">US — which posted record oil shipments in 2023 — is fast becoming a competitor</a> for market share.In 2016, Saudi Arabia launched a grand <a target="_blank" href="https://www.businessinsider.com/vision-2030-saudi-arabia-plan-future-proof-oil-economy-2023-8">Vision 2030</a> plan to transform its oil-dependent economy into a more diversified one that includes tourism and sports as key growth pillars.Recently, the kingdom has been indicating that it's frustrated with low oil prices. It's giving up its $100 per barrel price target and is ready to increase oil output, the <a target="_blank" rel=" nofollow" class="" href="https://www.ft.com/content/1d186f62-5941-4f9e-aef1-7d93a8a696cd">Financial Times</a> reported in late September.This means that Saudi Arabia is looking to corner a larger market share instead of targeting higher profit margins by restricting output.Russia has also expressed a desire to stop over-relying on oil exports."We are moving towards reducing the share of volatile income and reducing Russia's dependence on oil and gas in favor of boosting our domestic economy," Anton Siluanov, Russia's finance minister, told <a target="_blank" href="https://russian.rt.com/business/article/1379636-minfin-anton-siluanov-intervyu">RT Television's Arabic</a> service earlier this month.He said that Russia would instead aim to boost its domestic economy but did not specify how.Russia is already moving its trade eastward to address Western sanctions. <a target="_blank" class="" href="https://www.energyintel.com/00000192-ae46-dc01-adba-efff87000000">Saudi Arabia,</a> too, is looking to sell more oil to developing countries, whose electric vehicle adoption lags behind China and the West.Asia's emerging economies are expected to drive <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/global-oil-demand-prices-supply-opec-us-crude-producers-iea-2024-6">global oil demand</a> over the rest of the decade, as the world's consumption rises from 101.7 million barrels a day in 2023 to 105.6 million barrels per day by 2030, according to a June report from the <a target="_blank" class="" href="https://www.iea.org/news/slowing-demand-growth-and-surging-supply-put-global-oil-markets-on-course-for-major-surplus-this-decade">International Energy Agency</a>.<h2 id="6ae61431-8898-4c52-9abf-24b4a2055996">Prices, renewable energy, and the US all play a role</h2>Despite geopolitical tensions in the Middle East over fears of a widening war, oil prices haven't been on the climb.To be sure, <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/oil-price-prediction-brent-crude-israel-iran-opec-demand-citi-2024-10">oil prices could still</a> soar if the issues in the Middle East worsen.And there were several price spikes — such as in early October over concerns that Iranian oil facilities could be hit and in August over tensions in the Middle East — but they were shortlived. Oil prices dropped about 7% last week after the concerns subsided.International benchmark <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price">Brent</a> crude futures are down about 4% this year to date to around $74 a barrel, and US <a target="_blank" class="" href="https://markets.businessinsider.com/commodities/oil-price?type=wti">West Texas Intermediate</a> futures are down 1.3% so far this year to around $70 a barrel.A key contributor to the price trend comes from the US, which has witnessed a significant rise in oil production over the last 15 years following the shale oil boom.Matthew Huber, a Syracuse University professor who specializes in energy, climate politics, and resource geography, said the US has nudged Saudi Arabia out of its role as a swing producer."I think the US has now overtaken this role and because we're not in the Middle East, geopolitical conflict there is less impactful," Huber added.Then there's renewable energy."The explosion of electric vehicle adoption in China (and presumably or eventually in the US and Europe) means the writing is on the wall and we're going to reach 'peak demand' for oil sometime soon," said Huber. "It was always a good idea to diversify one's economy away from just oil but now more than ever."<h2 id="f0b0eb00-b6b7-4f2f-9acd-d2d555ca6010">The role of OPEC</h2>The changing dynamics of oil also sharpens the long-standing question of OPEC's influence and relevance. The oil producer group led by Saudi Arabia accounts for about 30% of global crude production."It goes in cycles. They were obviously relevant in the 1970s when they were able to increase prices almost single-handedly," said Huber."But the problem is when oil prices spike, it sends oil companies searching for temporarily profitable oil," he added, referring to the US shale boom as the most recent example.OPEC also faces rifts within its members, who have competing priorities."The big question now is whether OPEC members are all aligned in terms of oil targets," said The Geopolitical Business's Prakash, who added that not all OPEC members may be on board with Saudi Arabia's plan to boost production.A potential Trump presidency in the US could drive <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/stock-market-election-impact-trump-win-election-financials-energy-rbc-2024-10">domestic oil and gas production.</a>"If OPEC can't bring everybody together, and members go their separate ways, it will lead to a further polarization of the Middle East," said Prakash."Instead of energy bringing the region together, like it did in the past, energy coupled with geopolitics could fragment the Middle East," he said.

2 of the world's biggest oil producers are looking for new ways to power their economies

<ul class="summary-list"><li>US crude production hit a new all-time monthly high in August.</li><li>This complicates things for OPEC+, which was planning to start increasing output in December.</li></ul>The US is pumping a record amount of oil. But that may not be welcome news to other crude-producing nations.Domestic output reached <a target="_blank" href="https://www.eia.gov/petroleum/production/">13.4 million barrels a day in August,</a> eclipsing all previous monthly <a target="_blank" href="https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&amp;s=mcrfpus1&amp;f=m">records</a>. According to US Energy Information Administration data, firms in Texas and New Mexico led the surge.That level of production puts the US at odds with the plans of other oil-producing nations. OPEC+, an alliance led by Saudi Arabia and Russia, has said it plans to begin in December a sequence of monthly output increases. But given the decline in the price of crude oil — down 20% from an April high — continued record production from the US, and weakening demand, <a target="_blank" class="" href="https://www.bloomberg.com/news/articles/2024-10-29/oil-traders-split-on-whether-opec-will-hike-supply-in-december">oil traders believe OPEC+ will delay its program</a> for a second time.It's the culmination of a multi-year period that saw OPEC+ members cut production to support higher market prices, only to be undercut by expanding production from non-OPEC exporters.Looking into 2025, analysts speculate that global demand will continue sliding, especially given <a target="_blank" href="https://www.iea.org/commentaries/china-s-slowdown-is-weighing-on-the-outlook-for-global-oil-demand-growth">China's decelerating oil consumption</a>. That's one reason the global oil surplus could swell to 1.2 million barrels per day next year, according to JPMorgan. Otherwise, expanding outflows from the US, Brazil, Guyana and Canada will also play a part."OPEC+ increasingly appears to be searching for El Dorado: an oil market where demand is strong enough that it can increase output and prices stay above $80 per barrel," wrote Bill Weatherburn, senior climate and commodities economist at Capital Economics. "We suspect that this won't be found in 2025 either as China's demand growth will remain soft and more oil supply from non-OPEC+ producers will enter the market."

The US is pumping more oil than ever, and it's complicating things for other crude-exporting countries

The rupee depreciated 9 paise to 83.43 against the <keyword id="19949640" type="General" weightage="20" keywordseo="US-dollar" source="keywords">US dollar</keyword> in early trade on Monday amid rising <keyword id="20024983" type="General" weightage="20" keywordseo="crude-oil-prices" source="keywords">crude oil prices</keyword> and outflow of <keyword id="20480744" type="General" weightage="20" keywordseo="foreign-capital" source="keywords">foreign capital</keyword>. The domestic unit, however, found support due to a softening American currency and positive equity market sentiment, <keyword id="20024982" type="General" weightage="20" keywordseo="forex-traders" source="keywords">forex traders</keyword> said. At the interbank foreign exchange market, the local unit opened at 83.39 and lost further ground to trade at 83.43 against the greenback in initial deals, registering a fall of 9 paise from its previous closing level. On Friday, the rupee settled 11 paise higher at 83.34 against the US dollar. Meanwhile, the <keyword id="19976503" type="General" weightage="20" keywordseo="dollar-index" source="keywords">dollar index</keyword>, which gauges the greenback's strength against a basket of six currencies, was trading at 105.30, lower by 0.23 per cent. "The US dollar eased slightly on Friday after data showed inflation subsided, reinforcing expectations of Federal Reserve rate cuts this year," said Anand James, Chief Market Strategist, Geojit Financial Services. Brent crude futures, the global oil benchmark, advanced 0.52 per cent to USD 85.44 per barrel. In the domestic equity market, the 30-share BSE Sensex advanced 136.09 points, or 0.17 per cent, to 79,168.82. The broader NSE Nifty rose 41.75 points, or 0.17 per cent, to 24,052.35. Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday, as they offloaded shares worth Rs 23.09 crore, according to exchange data. India's forex reserves jumped by USD 816 million to USD 653.711 billion in the week ended June 21, the RBI said on Friday. In the previous week, the overall reserves had dropped by USD 2.922 billion to USD 652.895 billion. The eight key infrastructure sectors' growth rose by 6.3 per cent in May on healthy expansion in the production of coal, natural gas, and electricity, though the growth rate was lower than in April, according to official data released on Friday. The central government's fiscal deficit was at 3 per cent of the annual estimates at May-end 2024-25, the first two months of the financial year during which model code of conduct was in place due to Lok Sabha elections. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/news/vivo-v30e-review/articleshow/111385109.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/vivo-v30e-review/articleshow/111385109.cms" target="_blank">Vivo V30e review – mid-range smartphone with a large battery and sleek design</a><a href="https://www.businessinsider.in/tech/mobile/webstories/upcoming-smartphones-launching-in-india-in-july-2024/slidelist/111304902.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/webstories/upcoming-smartphones-launching-in-india-in-july-2024/slidelist/111304902.cms" target="_blank">Upcoming smartphones launching in India in July 2024</a><a href="https://www.businessinsider.in/business/auto/news/upcoming-cars-launching-in-india-in-july-2024/slidelist/111341281.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/news/upcoming-cars-launching-in-india-in-july-2024/slidelist/111341281.cms" target="_blank">Upcoming cars launching in India in July 2024</a>

Rupee falls 9 paise to 83.43 against US dollar in early trade

<ul class="summary-list"><li>Russia's energy trade likely boomed last month despite sanctions.</li><li>Oil and gas sales were on track to reach $9.4 billion, per calculations from Reuters.</li></ul>Russia's oil and gas business is set for a windfall this month. <a target="_blank" href="https://www.reuters.com/business/energy/russian-oil-gas-revenues-set-rise-by-50-yy-june-reuters-calculations-show-2024-06-25/">According to Reuters</a>, Russia's oil and gas revenue is set to surge to $9.4 billion in June, up roughly 50% from the $6 billion it took in from oil and gas sales in June of last year. That's a big boost for the Kremlin, given that oil and gas revenues have made up as much as half of the nation's total revenue for the past 10 years. The increase in revenue has largely been spurred by declining subsidies to Russia's oil refineries, which fell $60 billion from last month. That may encourage refineries to export oil and gas overseas for a higher price, as opposed to keeping oil and gas for domestic sales.The revenue jump is also a product of Russia's ability to navigate around Western sanctions, despite harsh restrictions on its oil and gas trade. Western nations have imposed bans on Russian energy imports and <a target="_blank" href="https://markets.businessinsider.com/news/commodities/russian-economy-oil-exports-price-cap-sanctions-g7-ukraine-war-2024-4">$60 price cap</a> on Russian oil. Yet, Moscow has been able to trade its energy products under the radar using a variety of methods, including utilizing a <a target="_blank" href="https://www.businessinsider.com/russia-shadow-fleet-of-oil-tankers-putin-tries-bust-sanctions-2022-12">shadow fleet of oil tankers</a> and offloading its oil to its <a target="_blank" href="https://markets.businessinsider.com/news/commodities/russia-economy-oil-sales-india-ukraine-war-moscow-western-sanctions-2024-2">key trading partners</a> like China and India.The <a target="_blank" href="https://www.businessinsider.com/russia-economy-west-secondary-sanctions-hitting-oil-exports-payments-revenue-2024-3">Bank of Russia</a>, though, has admitted sanctions pose an obstacle to its energy trade. Moscow's economy also appears to be feeling the effect of sanctions and the mounting costs of its war against Ukraine. Russia has set aside a <a target="_blank" href="https://www.businessinsider.com/russia-economy-defense-military-war-spending-drains-resources-other-sectors-2024-1">record military budget</a> this year. Civilians, meanwhile, are being pressured by <a target="_blank" href="https://www.businessinsider.com/russia-economy-ukraine-war-moscow-putin-inflation-labor-shortage-rates-2024-5">high inflation and double-digit interest rates</a>.

Russia's oil and gas revenue is reportedly set to boom 50% this month

The government on Tuesday cut the windfall tax on <keyword id="14320568" type="General" weightage="20" keywordseo="domestically-produced-crude-oil" source="Orion">domestically produced crude oil</keyword> while increasing the rate on export of diesel and jet fuel (ATF) in line with rise in international oil prices. The tax on <keyword id="45185" type="General" weightage="20" keywordseo="crude-oil" source="Orion">crude oil</keyword> produced by firms such as state-owned Oil and Natural Gas Corporation (ONGC), was cut to Rs.9,500 per tonne from Rs.11,000, beginning November 2, a government notification showed. In the fortnightly revision of windfall tax, the government hiked the rate on export of diesel to Rs.13 per litre from Rs 12 per litre. The levy on jet fuel too was increased to Rs.5 a litre, from Rs 3.50. The levy on diesel includes Rs 1.50 per litre road infrastructure cess (RIC), the notification showed. When the levy was first introduced, a windfall tax on export of petrol alongside diesel and ATF too was levied. But the tax on petrol was scrapped in subsequent fortnightly reviews. While the <keyword id="14716344" type="General" weightage="20" keywordseo="windfall-profit-tax" source="Orion">windfall profit tax</keyword> is calculated by taking away any price that producers are getting above a threshold, the levy on fuel exports is based on cracks or margins that refiners earn on overseas shipments. These margins are primarily a difference of international oil price realised and the cost. India first imposed windfall profit taxes on July 1, joining a growing number of nations that tax super normal profits of energy companies. At that time, export duties of Rs.6 per litre (USD 12 per barrel) each were levied on petrol and aviation turbine fuel and Rs.13 a litre (USD 26 a barrel) on diesel. A Rs.23,250 per tonne (USD 40 per barrel) windfall profit tax on domestic crude production was also levied. The duties were partially adjusted in the previous rounds on July 20, August 2, August 19, September 1, September 16, October 1 and October 16. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/property-prices-rise-6-in-top-8-cities-delhi-saw-the-highest-rise-colliers/articleshow/95559207.cms" style="">Property prices rise 6% in top 8 cities, Delhi saw the highest rise: Colliers</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/bombay-hc-orders-fresh-testing-of-johnson-johnson-baby-powder-allows-company-to-manufacture-but-not-sell-it/articleshow/95558790.cms" style="">Bombay HC orders fresh testing of Johnson &amp; Johnson baby powder; allows company to manufacture but not sell it</a>

Windfall profit tax on crude oil hiked, levy on export of diesel cut

<ul class="summary-list"><li>The oil market could see a supply crunch, Goldman Sachs said.</li><li>Oil demand will rise for another 10 years, though producers are pulling back on new investment.</li></ul>The global oil market could run into a supply shortage as peak demand is still a decade away, according to Goldman Sachs analysts.The investment bank estimated the world's oil demand would continue to rise for at least the next 10 years, with <a target="_blank" href="https://www.goldmansachs.com/intelligence/pages/peak-oil-demand-is-still-a-decade-away.html">crude demand peaking at around 110 million barrels</a> a day in 2034. That's due to rising oil demand in Asia and increasing demand for petroleum products, the analysts said.Rising demand could spark a supply shortage, especially if companies continue to dial back on capital expenditures, the bank added. Spending by six major oil producers, including ExxonMobil and Chevron, could fall as much as $3.8 billion this year, according to a survey conducted by <a target="_blank" href="https://www.ogj.com/general-interest/economics-markets/article/55016973/us-ep-companies-capital-spending-to-decrease-in-2024">Oil &amp; Gas Journal</a>."We think peak demand is another decade away, and more importantly, after the decade it takes to peak, it plateaus, rather than sharply declines, for another few years," Nikhil Bhandari, a managing director at Goldman, and Amber Cai, an analyst at the bank, said in a recent report. "While peak oil demand is still a decade away, capital is slowing for the production of crude oil and oil products, contributing to constrained supply in the medium term," they later added.Oil prices slumped at the end of 2023, in part due to <a target="_blank" href="https://markets.businessinsider.com/news/commodities/us-oil-crude-production-record-opec-cuts-russia-saudi-arabia-2024-3">booming crude production in the US</a> and <a target="_blank" href="https://markets.businessinsider.com/news/commodities/oil-market-outlook-opec-price-cuts-us-crude-production-guyana-2023-12">other countries</a>. But US production is set to see a <a target="_blank" href="https://markets.businessinsider.com/news/commodities/oil-supply-us-production-outlook-slashed-half-prices-could-climb-2024-3">slowdown</a>, with the US Energy Information Agency forecasting domestic <a target="_blank" href="https://www.eia.gov/outlooks/steo/pdf/steo_full.pdf">crude production</a> to grow by just 2% from levels in 2023. Other oil producers are continuing to pull back on production, too. OPEC+, the oil cartel led by Saudi Arabia, has decided to <a target="_blank" href="https://www.opec.org/opec_web/en/press_room/7337.htm">extend its 2.2 million barrel-a-day supply cut</a> into 2025, according to a release from its last meeting.Oil prices have climbed higher over the past month as markets weigh the supply and demand outlook. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price">Brent crude</a> has surged 8% from its low in early June, trading around $84.51 a barrel on Monday.

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Windfall profit tax on crude oil hiked, levy on export of diesel cut

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The oil market is at risk of a supply shortage as peak demand is still 10 years away, Goldman Sachs says

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