Are Georgia and Kyrgyzstan Helping Russia Evade Car Sanctions?

By Eurasianet - Feb 03, 2025

• Georgia's car exports to Kyrgyzstan surged in 2024, raising suspicions that the vehicles are being re-exported to Russia in violation of international sanctions.
• 
  
• Discrepancies between Georgian and Kyrgyz trade data suggest that many cars are not reaching their stated destination.
• 
  
• Despite pressure from the US and new regulations in Kyrgyzstan, the illicit car trade appears to be continuing unabated.
• 
  

In 2023, Georgia’s government banned the re-export of automobiles to Russia, a move intended to align with international sanctions against Moscow. But recent trade data is buttressing suspicions that Georgia is still serving as a key waypoint in a network used by Russia to import goods, especially automobiles. 

According to figures released by the National Statistics Office of Georgia, for the second year in a row, cars were the most exported item from Georgia in 2024, totaling more than $2.4 billion and accounting for 37 percent of the country’s overall volume of exports. Curiously, the top destination for all exports was not a neighboring country, but Kyrgyzstan, a Central Asian nation state situated more than a thousand miles away. Exports from Georgia to Kyrgyzstan totaled $1.3 billion last year, marking a remarkable 85 percent increase over the previous year’s total.

The Georgian-Kyrgyzstan connection has long faced scrutiny for being a major supply channel relied on by Russia to overcome Western sanctions.

Since Western nations started sanctioning Russia after its invasion of Ukraine, the Kremlin has used Kyrgyzstan as a backdoor to obtain sanctioned goods, especially dual-use components that help keep the Russian war effort going. Autos are also a big import item: the number of cars entering Kyrgyzstanexploded to more than 180,000 in 2023, up from around 40,000 in 2022, the year the Russia-Ukraine war began.

Georgia has long been known as a regional purveyor of used cars. But the latest data represents a change in the dynamic of Georgian exports. In 2023, Azerbaijan was the country’s top trading partner, and automobiles comprised the bulk of exports from Georgia, according to local media, with Azerbaijan importing more than $430 million in automobiles. That figure decreased last year, although Azerbaijan – a country that has also been accused of re-exporting sanctioned goods, including automobiles, to Russia – was still Georgia’s third-largest trading partner in 2024.

Observers note that discrepancies in official data figures indicate that many cars ostensibly sold by Georgian sellers to Kyrgyz buyers aren’t making it to their supposed destination. Instead, they may be diverted to Russia.

“According to Georgian statistics, in [the first] 10 months of [2024] … cars worth $964 million were sold as re-exports from Georgia to Kyrgyzstan. According to the statistics of Kyrgyzstan, cars worth about $50 million entered from Georgia. Where did goods worth more than $900 million disappear?” asked Georgian opposition politician Roman Gotsiridze last November, adding that he believes the cars are ending up in Russia.

Authorities in both countries claim they are striving to contain illicit trade. While Georgian officials seem to be turning a blind eye to the passage of sanctioned dual-use goods through the country, their counterparts in Kyrgyzstan have nominally taken measures of late to corral sanctions-busting practices.

Last fall, under pressure from the United States, Kyrgyz officials started requiring traders to confirm that goods they are paying for will arrive in Kyrgyzstan within 60 days. The government also established a new state regulatory entity to monitor trade.

The impact of such measures is not reflected in the 2024 trade data, and whether the new rules and procedures are being effectively implemented remains uncertain. 

By Brawley Benson va Eurasianet.org 

 

Tariffs on Oil Are a Major Problem for U.S. Refiners

By Charles Kennedy - Feb 03, 2025

• US tariffs on Canadian and Mexican imports will add to the financial burden of US refiners struggling with declining profit margins.
• 
  
• Canada may divert oil exports to Asia due to the tariffs, while Mexico could retaliate with limitations on oil supplies to the US.
• 
  
• Industry leaders warn that the tariffs could ultimately benefit Asian refiners while harming US consumers with higher fuel prices.
• 
  

Tariffs on imports from Canada and Mexico will further weaken the position of U.S. refiners who are already facing headwinds due to declining refining margins, Energy Aspects director of research Amrita Sen told Bloomberg on Monday.

On Saturday, the U.S. Administration announced that additional tariffs would be implemented on Canada, Mexico, and China this week. Canada and Mexico face 25% tariffs, with Canadian energy slapped with a lower, 10%, tariff.

The 10% tariff on Canadian oil imports doesn’t break U.S. refining, but it will add to the costs of refiners in the Midwest and the West Coast, although a weakened Canadian dollar would absorb some of that tariff, Sen told Bloomberg.

Canada could send more of its oil to Asia from its Pacific Coast after the expansion of the Trans Mountain pipeline, while the U.S. has to pay up for alternatives, Sen said.

The bigger problem for U.S. refiners would be the 25% tariff on imports from Mexico. Refiners in the U.S. Gulf Coast face much higher costs for 400,000 bpd of Mexican crude and another 200,000 bpd of fuel oil imports.

Essentially, the tariffs “are a boon to Asian refiners,” Sen told Bloomberg.

“It’s a win for a lot of the rest of the world, just a massive loss for US refining,” she added.

It will be an unintended consequence “but that is absolutely how it’s going to play out,” Sen said.

Commenting on the tariff announcement, American Fuel & Petrochemical Manufacturers (AFPM) President and CEO Chet Thompson said, “We are hopeful a resolution can be quickly reached with our North American neighbors so that crude oil, refined products and petrochemicals are removed from the tariff schedule before consumers feel the impact.”

“American refiners depend on crude oil from Canada and Mexico to produce the affordable, reliable fuels consumers count on every day,” Thompson added.

American Petroleum Institute President and CEO Mike Sommers commented that API would continue to work with the Trump administration “on full exclusions that protect energy affordability for consumers, expand the nation’s energy advantage and support American jobs.”

By Charles Kennedy for Oilprice.com

 

Shell Resumes Production From UK North Sea Oilfield After Redevelopment

By Tsvetana Paraskova - Feb 04, 2025

Shell has restored oil and gas production from the Penguins field in the UK North Sea with a new floating, production, storage and offloading (FPSO) facility, the UK-based supermajor said on Tuesday, days after a court ruled that government approvals for two planned UK fields were unlawful.

The new Shell-operated FPSO facility will be the new export route for the Penguins field’s oil and gas production, replacing the previous export route via the Brent Charlie platform, which ceased production in 2021, and is being decommissioned.

As a result, the Penguins field, 150 miles northeast of the Shetland Islands, was redeveloped by drilling additional wells, which are tied back to the new FPSO.

Discovered in 1974, the field previously produced oil and gas between 2003 and 2021.

Shell estimates peak production from Penguins at around 45,000 barrels of oil equivalent per day (boed). Currently, the field has an estimated discovered recoverable resource volume of approximately 100 million boe.

Although primarily oil production, Penguins will also produce enough gas to heat around 700,000 UK homes per year, Shell said in a statement.

The new FPSO will have 30% lower operational emissions compared with Brent Charlie and is expected to extend the life of this field by up to 20 years.

Natural gas will be transported through the existing pipeline to the St Fergus gas terminal in the northeast of Scotland, which supplies the UK’s national gas network.

“Today, the UK relies on imports to meet much of its demand for oil and gas,” said Zoë Yujnovich, Shell’s Integrated Gas and Upstream Director.

“The Penguins field is a source of the secure domestic energy production people need today.”

The restart of Penguins comes days after the Scottish Court of Session ruled that the government approval for Shell’s Jackdaw and Equinor’s Rosebank fields in the UK North Sea was unlawful, dampening industry hopes that new domestic oil and gas production could begin soon and help reduce the UK’s reliance on imported oil and gas.

At the end of last year, Equinor and Shell announced they would merge their UK oil and gas assets in a 50/50 joint venture which will be the largest independent oil and gas producer in the UK North Sea.

By Tsvetana Paraskova for Oilprice.com

Back in Iraq: BP Puts $25B On the Table

By Julianne Geiger - Feb 04, 2025


BP is about to make a big bet on Iraq—again. After years of false starts, geopolitical chaos, and stalled negotiations, the British oil major is reportedly gearing up to invest up to $25 billion in Iraq’s Kirkuk oil and gas fields. That’s according to a senior Iraqi official who spoke to Reuters in an exclusive.

That’s a hefty price tag for a region that’s seen more than its fair share of conflict and instability—but with crude prices hovering near the $75 mark and Iraq eager to reclaim its position as a top global oil supplier, the timing might just be right.

The Road to Kirkuk


BP’s history in Kirkuk runs deep. The company was part of the original consortium that discovered oil there almost a century ago, but its more recent attempts to develop the fields have been anything but smooth. A 2013 agreement with Baghdad was scrapped after ISIS tore through northern Iraq in 2014. Then, in 2017, the Iraqi government wrested control of the region from Kurdish forces after a failed independence referendum, adding to the existing political drama. By 2019, an exasperated BP had walked away entirely after failing to reach an expansion deal.

Now, BP is back—this time with a profit-sharing agreement that could stretch over 25 years. If it sticks, this deal would be one of the largest foreign investments in Iraq’s oil sector since the TotalEnergies $27 billion megadeal in Basra last year.

What’s in It for BP?

For BP, the allure is simple: Iraq holds the world’s fifth-largest oil reserves, and Kirkuk alone is sitting on about 9 billion barrels of recoverable crude. Under the deal, BP is expected to boost production from 300,000 barrels per day (bpd) to 450,000 bpd within two to three years.

Unlike Iraq’s usual technical service contracts—which pay oil companies a flat fee for their work—this profit-sharing model allows BP to recover costs first and then start making real money once production rises above current levels. That’s a major departure from past agreements that had left foreign oil companies grumbling about thin margins.

What's In It For Iraq?

Iraq may have massive oil reserves, but it also has serious infrastructure problems. Years of war, corruption, and government mismanagement have crippled production capacity, and investors have been skittish about diving back in. Iraq is OPEC’s second-largest producer, but its oil industry is operating well below its potential.

Baghdad desperately needs foreign investment to modernize its aging fields and improve natural gas capture, especially since much of the country’s associated gas is flared rather than utilized. This BP deal isn’t just about pumping more crude—it’s also supposed to help expand Iraq’s domestic energy production to meet rising electricity demand.

The Risks and Realities

Of course, this is Iraq--and even with relatively stable oil prices, political instability remains a major concern. The country’s oil sector is still fraught with overbearing bureaucracy, security risks, and shifting alliances between Baghdad and the semi-autonomous Kurdish Regional Government (KRG).

And with President Trump ramping up pressure on Iran and its regional allies, Iraq could easily get caught in the crossfire. BP, already operating in Iraq’s southern Rumaila oilfield, will have to navigate all of this while trying to turn a profit in Kirkuk.

Worth the Gamble?

At $25 billion over 25 years, BP is making a massive bet that Iraq can stabilize its oil sector and provide the kind of investment-friendly climate that has eluded the country for decades. If the project succeeds, BP could have a major foothold in one of the world’s most oil-rich regions.

But if Iraq’s history of instability repeats itself, BP might find itself right back where it was in 2019—packing up its marbles and going home.

By Julianne Geiger for Oilprice.com

Snubbed in Syria, Russia Now Makes a Move on Syrian Oil

By Simon Watkins - Feb 03, 2025

• Following the ousting of Bashar al-Assad, Syria's new government is inviting investment in its oil and gas sector.
• 
  
• The U.S. and its allies are maneuvering to counter Moscow’s longstanding influence in Syria.
• 
  
• With proven oil and gas reserves and crucial Mediterranean access, Syria remains a valuable energy hub.
• 
  

Following the sudden removal of longtime Syrian President Bashar al-Assad from office on 8 December, the new caretaker government has issued public tenders for the development of the country’s oil and oil products sector. At the same time, its caretaker Oil Minister Ghiath Diab said that Syria wants to resume major exploration and production activities for both its oil and gas operations. Given the vital geopolitical importance of the country that lies in the heart of the Middle East and has a long Mediterranean coastline, competition between the major global powers to establish a strong foothold in the state’s new political order is already hotting up.

First to pay an official high-level visit to Syria was Russia, with Deputy Foreign Minister Mikhail Bogdanov arriving in Damascus on 28 January. He met with the new President of Syria, Ahmed al-Sharaa, together with his Foreign Minister Asaad al-Shaibani and Minister of Health Maher al-Sharaa. Saudi Arabian by birth, Al-Sharaa is also the emir of the radical Islamist group Hayat Tahrir al-Sham (HTS) which spearheaded the final lightning-fast removal of al-Assad. He fought for al-Qaeda in Iraq for three years from 2003 and then founded the radical Islamist al-Nusra front in 2012, after being imprisoned by the U.S. from 2006 to 2011. He is still listed by the U.S. State Department as a ‘Specially Designated Global Terrorist’ and had a US$10 million reward for information leading to his capture offered by Washington. Following a meeting in December 2024 between al-Sharaa and a U.S. delegation led by Assistant Secretary of State for Near Eastern Affairs, Barbara Leaf, the bounty was withdrawn.  According to a press release from the Russian Foreign Ministry, the recent meeting between Bogdanov and al-Sharaa focused on Moscow’s ‘unwavering support for the unity, territorial integrity, and sovereignty of the Syrian Arab Republic’. It added that both parties ‘agreed to maintain bilateral engagement with a view to formalising pertinent arrangements, reflecting a mutual resolve to deepen comprehensive ties and understanding between Moscow and Damascus, including in foreign policy spheres’.

It is little wonder that Moscow is so keen to get on the right side of al-Sharaa given that Syria is vital to its key strategic interest for three key reasons, as analysed in full in my latest book on the new global oil market order. First, it is the biggest country on the western side of the Shia Crescent of Power that Russia had been studiously developing for years as a counterpoint to the U.S.’s own sphere of influence centred then on Saudi Arabia (for hydrocarbons supplies) and Israel (for military and intelligence assets). Second, it offers a long Mediterranean coastline from which Russia could send oil and gas products – or anything else – from itself or from its allies (notably Iran) for export either into major oil and gas hubs in Turkey, Greece and Italy or into north, west and east Africa. And third, it is a vital military and intelligence hub for the Kremlin, with one major naval base (Tartus – and Russia’s only Mediterranean port), one major air force base (Khmeimim) and one major listening station (just outside Latakia).

Russia had also intended to make its Syrian client state an essentially self-financing operation, once it had fully resuscitated the country’s once-sizeable oil and gas industries. At the time civil war broke out in Syria in 2011, the country had been producing around 400,000 barrels per day (bpd) of crude oil from proved reserves of 2.5 billion barrels. Before recovery began to drop off due to a lack of enhanced oil recovery techniques being employed at the major fields – mostly located in the east near the border with Iraq or in the centre of the country, east of the city of Homs – it had been producing nearly 600,000 bpd. For the period when the largest producing fields – including those in the Deir-ez-Zour region, such as the biggest field, Omar – were under the control of ISIS, crude oil and condensates production fell to about 25,000 bpd before recovering again. Europe imported at least US$3 billion worth of oil per year from Syria up to the beginning of 2011, and many European refineries were configured to process the heavy, sour ‘Souedie’ crude oil that makes up much of Syria’s output, with the remainder being the sweet and lighter ‘Syrian Light’ grade. Most of this – some 150,000-bpd combined – went to Germany, Italy, and France, from one of Syria’s three Mediterranean export terminals: Banias, Tartus, and Latakia. Syria’s gas sector was at least as vibrant as its oil one, and less of that was damaged in the first few years of the conflict. With proven reserves of 8.5 trillion cubic feet (tcf) of natural gas, the full year 2010 – the last under normal operating conditions – saw Syria produce just over 316 billion cubic feet per day (bcf/d) of dry natural gas. The build out of the South-Central Gas Area by Russia’s Stroytransgaz – had started up by the end of 2009 and had boosted Syria’s natural gas production by about 40% by the beginning of 2011. This allowed Syria’s combined oil and gas exports to generate a quarter of government revenues at that point, and to make it the eastern Mediterranean’s leading oil and gas producer at the time.

In November 2017, a re-worked version of an original 2015 Russia-Syria Cooperation Plan was signed, encompassing not just the restoration of at least 40 energy facilities in Syria, including offshore oil fields, but a lot more as well, as also detailed fully in my latest book on the new global oil market order. For a start, focus would turn to expanding the power sector, based on from a plan signed between Syria’s then-Electricity Minister Mohammad Zuhair Kharboutli and Russia’s Minister of Energy Alexander Novak. The deal covered the full reconstruction and rehabilitation of the Aleppo thermal plant, the installation of the Deir Ezzor power plant and the expansion of capacity of the Mharda and Tishreen plants, with a view to re-energising Syria’s power grid and restoring the main control centre for the grid back to Damascus. This accorded with comments as early as the middle of December 2017 (by then-Russian Deputy Prime Minister Dmitry Rogozin, following talks in Syria with then-President Bashar al-Assad) that: “Russia will be the only country to take part in rebuilding Syrian energy facilities.” Over and above the four power plant projects that were to be optimised as a priority, the key infrastructure project was the complete repair and capacity-boosting upgrading of the Homs oil refinery (Syria’s other was then in Banias). The practical project work was led by Iran’s Mapna and Russian companies, with the initial target capacity being 140,000 bpd. Phase 2’s objective was 240,000 bpd and Phase 3’s was 360,000 bpd. The intention was that it could also be used to refine Iranian oil coming through Iraq if needed, before onward shipment into southern Europe. It is precisely this wide-ranging multi-layered energy, military, and political cooperation plan that Russia wants to re-establish with the new regime.

If for no other reason than to screw with Russia’s grand plan – a powerful enough idea in the zero-sum game of superpower politics – the U.S. and its allies have a different agenda for the country. As echoed in the December meeting between the U.S. delegation and al-Sharaa, several formerly impeccable senior security and energy sources in Washington, London, and Brussels exclusively told OilPrice.com just after al-Assad’s removal that the sudden – and otherwise inexplicable – success of the Syrian rebels led by HTS was in no small part connected to a massive surge in U.S. and U.K. support for them in the run-up to the coup. “The U.S. wanted to put Moscow’s and Tehran’s leadership on notice that Washington can easily redraw and restructure borders and regimes in not just the Middle East but also in Eastern Europe, if it wants to,” a senior security source in the European Union (E.U.) told OilPrice.com. “As he’s [al-Assad] gone now, I can’t see either Washington sitting back and allowing anyone to benefit from this other than the U.S., and if the reconstruction is done in a gradual and inclusive [with Syria’s principal former rebel groups], the outcome may be better than seen elsewhere in the region,” he concluded.

By Simon Watkins for Oilprice.com

OPEC Drops U.S. EIA as a Secondary Source Assessing Oil Production

By Charles Kennedy - Feb 03, 2025

OPEC has replaced the EIA with Kpler, OilX, and ESAI as secondary sources for assessing crude oil production and compliance with output cuts.

This decision comes after OPEC previously dropped the IEA from its list of data sources.

The move is seen as a significant snub to the U.S. energy agency and reflects growing tensions between OPEC and the West.


OPEC is dropping the U.S. Energy Information Administration (EIA) as a secondary source to assess crude oil production of the OPEC+ countries and their compliance with the group’s output cuts, the cartel said after a panel meeting on Monday.

After thorough analysis from the OPEC Secretariat, the Joint Ministerial Monitoring Committee (JMMC) replaced consultancy Rystad Energy and the EIA with Kpler, OilX, and ESAI, as part of the secondary sources used to assess the crude oil production and compliance, OPEC said.

The move is effective from February 1, 2025. Before that date, OPEC used figures from seven consultancies and agencies, including the EIA, Rystad Energy, and Wood Mackenzie, among others.

OPEC uses secondary sources to track and report its crude oil production and to monitor compliance with the OPEC+ production cuts by using the average of the figures provided by these sources.

OPEC had already dropped in 2022 the International Energy Agency (IEA) from its list of secondary sources after the Paris-based agency embarked on a campaign to criticize oil-producing countries and call for no new oil and gas projects in a world of net zero emissions.

OPEC has repeatedly slammed the international agency for what the cartel says are “dangerous” predictions of peak oil demand by 2030.

Saudi Energy Minister Abdulaziz bin Salman even called in 2021 the IEA’s Roadmap to Net Zero “La La Land”.

Now it’s the turn of the U.S. EIA to be replaced as a secondary source.

OPEC did not give explanations as to why it has decided to drop the U.S. energy administration from its pool of secondary sources providers.

At the Monday meeting of the JMMC, the OPEC+ panel reviewing policy and markets and potentially recommending actions to the group’s ministers to take, the committee said it would not recommend changes to the group’s current plans to begin gradually unwinding the cuts in April 2025.

By Charles Kennedy for Oilprice.com

Why US Refiners Won’t Ditch Canadian Crude

By Alex Kimani - Feb 03, 2025

Stanchart: Tariffs on Canadian oil could lead to reduced refinery runs and higher gas prices in the U.S. Midwest.

Analysts predict Mexico may opt to divert exports to Asia and Europe, significantly reducing shipments to the U.S.

Despite the 10% levy, Canadian crude flows to the U.S. are unlikely to be disrupted.



Mexico’s President Claudia Sheinbaum has announced that U.S. tariffs are on hold for one month after she held talks with President Trump and pledged to send 10,000 troops to the border to fight drug trafficking. Trump also spoke to Canadian Prime Minister Trudeau to discuss the punitive tariffs, saying that Ottawa has “misunderstood” the situation. Over the weekend, Trump slapped Canada and Mexico with duties of 25% and China with a 10% levy. Oil flows facing tariffs represent 44% of U.S. oil product imports, 69% of crude oil imports and 81% of heavy crude oil imports. Last week, Trump engaged in his usual isolationist bluster, claiming that the U.S. does not need Canadian commodities including oil and lumber. “We don’t need anything they have. We have unlimited Energy, should make our own Cars, and have more Lumber than we can ever use. Without this massive subsidy, Canada ceases to exist as a viable Country,” he said while speaking at the World Economic Forum.

However, the experts have pointed out that Trump needs a reality check.

“It’s not factually correct,” Richard Masson, an executive at the University of Calgary’s School of Public Policy, told CTV News. “They do need our oil. We ship diluted bitumen, so four million barrels a day go to the states; more than two million barrels a day of that is diluted bitumen. It goes to refineries that are specifically configured to process it, especially in Minneapolis, Chicago and Wood River. That’s why they rely on it so heavily. So, the first part is hopefully we can talk to him and educate him if he doesn’t understand it. I’m sure that the big refiners in the U.S. are doing that now. But if it turns out that he’s going to put a tariff on it, then our challenge will be what happens to overall demand.”

Similarly, commodity analysts at StandardChartered have painted a dire picture of the situation, saying oil buyers in the Midwest will almost certainly pay the price of the tariffs thanks to the limited substitutability of Canadian crude with other oils resulting in strong pass-through to retail prices.

According to the analysts, the U.S. imported ~ 6.6 million barrels per day (mb/d) of crude oil in the first 10 months of 2024, of which 4.0 mb/d was heavy oil for use in upgraded refineries with cracking units. Canada provided 75% of U.S. heavy crude oil imports in 2024, with its market share having steadily increased since 2000, squeezing outflows from Mexico, Venezuela and Colombia. Some 80% of Canada's crude production flows downstream to U.S. refiners, with U.S. imports of Canadian crude reaching a record high of 4.42M bbl/day in the week ending January 3, according to the U.S. Energy Information Administration.

Unfortunately for Midwest refineries, heavy oil cannot easily be substituted with the light oil that makes up most of U.S. shale oil production. StanChart has pointed out that such a switch would create a significant loss of optimization in the highly expensive cracking units that require feed from vacuum distillation of the heavy residual obtained by simple distillation. Canada has supplied 99.89% of all heavy imports into Midwest refineries over the past decade; the low substitutability of this flow implies that a tariff would largely feed through to local retail prices. Refiners will also have to cut runs due to the loss of refinery optimisation.

And, the increase in fuel prices would be substantial: According to GasBuddy analyst Patrick De Haan, consumers in the Midwest could end up paying ~10% extra for their gas if Trump goes ahead with his tariffs. Tom Kloza at the Oil Price Information Service has predicted that the tariffs could raise gasoline prices by $0.35/gal in parts of the country if the tariffs were passed completely along to consumers.

Meanwhile, StanChart has predicted that Mexico’s exports to the U.S. are likely to all but cease, with oil being rerouted into Asia and Europe. Last month, the European Union and Mexico agreed to a revamped free-trade agreement days before Trump began a second term. Mexico, in particular, pushed hard to revamp the trade deal with the EU ahead of Trump’s inauguration as a way to show strength before the review of the US-Mexico-Canada trade agreement, known as USMCA. The U.S. is, by far, Mexico’s biggest trade partner, accounting for 83% of Mexico’s trade relationship. Trump has criticized the EU’s trade practices and said he would impose duties on exports by the bloc. He’s also said he’d impose 25% tariffs on goods from Mexico.

“This landmark deal proves that open, rules-based trade can deliver for our prosperity and economic security, as well as climate action and sustainable development,” European Commission President Ursula von der Leyen said in a statement.

By Alex Kimani for Oilprice.com

Canadian Crude Becomes a Bargain for China as US Tariffs Bite

By Irina Slav - Feb 03, 2025

U.S. tariffs on Canadian crude make the barrel more expensive for U.S. refiners.

The tariffs could give European and Asian refiners a competitive edge.

Canada is the biggest supplier of heavy crude to American refiners, exporting it at a rate of close to 4 million barrels daily.





President Donald Trump’s threatened tariffs on the United States' two largest trade partners—Canada and Mexico—have become a reality. Canadian imports will now face a 25% tariff, while Mexico has secured a 30-day pause. Even with a reduced tariff on Canadian crude, the added costs will make refining feedstocks more expensive for U.S. refiners, giving their European and Asian competitors a competitive edge.

Trump has picked tariffs as his favored trade policy weapon to balance a trade deficit the U.S. is running with the European Union—next on the tariff chopping block—and as a means of forcing U.S. neighbors to tighten border control with a view to stemming illegal immigration and fentanyl smuggling. The decision to impose the tariffs on Canada and Mexico has been widely criticized, with critics noting it would hurt American taxpayers, whom Trump promised cheaper fuel.

Canada warned as much early on. “Canadian energy and resources—including oil and critical minerals—underpin the long-term economic security and prosperity of both Canada and the United States to protect our energy security and reduce our reliance on the resources of non-like-minded countries,” Canada’s foreign minister, Melanie Jolie, told the Financial Times last month. She went on to warn the tariff push could force U.S. refiners to swap Canadian for Venezuelan crude in what would be an ironic twist.

Related: U.S. Natural Gas Prices Surge On Canada Tariffs, Massive Withdrawals

Canada is the biggest supplier of heavy crude to American refiners, exporting it at a rate of close to 4 million barrels daily, which makes it the biggest exporter of crude oil to the U.S. in general. Mexican crude oil exports north of the border are much smaller, at less than half a million barrels daily, but they still comprise the second-largest share of foreign oil in U.S. refiners’ mix.

According to analysts that Reuters spoke to in the wake of the tariff announcement, the tariffs will hit refiners, shrink their margins and eventually force production curbs—to the potential benefit of refiners in Europe and Asia because as local production of fuels shrinks, imports would have to increase in what seems to be another ironic twist of the Trump tariff crusade.

“Less U.S. diesel exports would support European margins, while more export opportunities may remain in the strongly pressured gasoline market,” Vortexa chief economist David Wech told the publication, adding that the tariffs would be “overall a positive for European refiners, but likely not for European consumers,” as they would squeeze the local supply of fuels.

What could further complicate the situation is Trump’s plan to give the European Union the same tariff treatment he just gave Mexico and Canada, which means European fuel exports to the U.S. would also fall victim to tariffs. This would affect prices as well, both in Europe and the United States—and, of course, prompt retaliatory measures as it did from Canada.

Justin Trudeau already said Canada’s federal government would respond in kind to Trump’s tariffs with a 25 levy on U.S. imports worth some $21 billion, effective Tuesday, and then follow with extending the levy to another $85 billion worth of imports. He also suggested export curbs could be added to the retaliation. “There are a number of different industries and regions of the country that can have greater leverage over the US," Trudeau said, as quoted by Argus. "One thinks of the oil industry for example.”

Meanwhile, Asian—and, more specifically, Chinese—refiners will be more than happy to take in Canadian and Mexican oil that has become too expensive for U.S. refiners, according to analysts interviewed by Reuters. One analyst, founder of Next Barrel, told the publication crude oil sellers would be forced to discount their crude in order to find alternative buyers to U.S. refiners—a most welcome development for Asian refiners who appreciate a bargain.

Another commentator pointed out that in China, demand for refinery feedstocks is about to increase, so it is an opportune moment for refiners there to stock up on discount-heavy from Canada—the expanded Trans Mountain pipeline will come in handy in this respect.

Trump himself has admitted there will be a negative impact from the tariffs on Americans, describing it as “short term” and adding, “I don't expect anything dramatic,” and “They owe us a lot of money, and I'm sure they're going to pay.” Trump also confirmed that the European Union is next, but did not specify a date.

“We may have short term some little pain, and people understand that. But in the long term, the United States has been ripped off by virtually every country in the world,” the U.S. president said, as quoted by Reuters. Indeed, the whole tariff spat could turn out to be a short-term thing as Trump has said he would talk to Justin Trudeau and Claudia Sheinbaum this week. If they fail to reach a mutually beneficial agreement, however, it’s win time for refiners in Europe and Asia—until they get hit by tariffs, too.

By Irina Slav for Oilprice.com

THE FORGOTTEN WAR

Nagorno-Karabakh Conflict: Is a Lasting Peace Agreement Finally Within Reach?

By Eurasianet - Feb 04, 2025

Armenian Prime Minister Nikol Pashinyan has expressed willingness to explore a modified version of the Zangezur corridor, without granting Azerbaijan extraterritorial rights.
Armenia has also proposed dropping international court cases against Azerbaijan and is open to dissolving the OSCE Minsk Group to advance peace talks.
These concessions are likely linked to Armenia's desire to create new trade possibilities, including joining a project to export electricity from Central Asia to Europe via Azerbaijan.


Armenian Prime Minister Nikol Pashinyan is sending signals designed to place the Armenian-Azerbaijani peace process back on the front burner. In particular, Pashinyan has expressed openness to exploring a modified version of the Zangezur corridor, which would establish a direct link between Azerbaijan proper and the Nakhchivan exclave via Armenian territory.

The corridor issue has proven a major stumbling block for the peace process. Last summer, both sides agreed to set the issue aside, but a few weeks ago, Azerbaijani leader Ilham Aliyev unexpectedly restored Zangezur to the negotiating agenda, slamming the brakes on hopes that a peace deal could be finalized quickly.

Azerbaijan has demanded extraterritorial rights for Zangezur, something that would effectively extend Baku’s sovereignty over the route. Armenia has been wary of the very notion of a corridor, but at a January 31 news conference, Pashinyan appeared to adjust his position slightly, saying Armenia would be willing to establish a corridor under the same terms that Azerbaijan would enjoy on a planned railway via Iran to connect to its exclave. Extraterritoriality is not part of the Iranian route discussions.

Armenian Foreign Minister Ararat Mirzoyan was cagey when asked about Armenia’s vision for Zangezur, repeating that Armenia wants to retain full authority over administration of the route, while holding out the possibility that Azerbaijan could enjoy some sort of special privileges. “Naturally, we also recognize that the 21st century is an era of simplifications and logistical facilitation, where all nations seek to ease transit procedures,” Mirzoyan told journalists on January 30. “With Azerbaijan as well, once transport links are unblocked, we foresee certain simplified procedures that could be applied, bringing benefits to both us [Armenia] and Azerbaijan.”

Pashinyan also announced that Armenia has made new proposals on two issues in peace negotiations that remain unresolved, including the possible withdrawal of cases currently pending in international courts. He similarly announced at his January 31 news conference a tentative willingness to explore the dissolution of the OSCE Minsk Group, which oversaw peace negotiations for decades but whose influence has dissipated since Baku’s reconquest of Nagorno-Karabakh. Azerbaijan has long accused Minsk Group members, especially France, of being biased in Armenia’s favor.

Pashinyan’s efforts to entice Azerbaijan back to the negotiating table are likely linked to a desire to create new trade possibilities. On January 30, he stated Armenia’s intent on joining a project facilitating the export of electricity from Central Asia across the Caspian Sea to Azerbaijan and onward to Europe. On February 3, Azerbaijan’s parliament ratified an agreement with Kazakhstan and Uzbekistan to generate “green” electricity and send it westward via a cable beneath the Caspian Sea.

By Eurasianet.org

POSTMODERN IMPERIALI$M

Gates-Bezos backed KoBold begins hunt for battery metals in Namibia

4th February 2025
By: Bloomberg

KoBold Metals Co., backed by billionaires including Bill Gates and Sam Altman, is extending its search for battery metals to Namibia, a country not known for producing the minerals.

The company is prospecting for lithium and nickel in southern and central Namibia after securing licenses in the third quarter of last year, Mfikeyi Makayi, chief executive officer of its African operations, said in an interview Tuesday in Cape Town.


KoBold was valued at nearly $3-billion in its latest fund-raising round. The US-based company uses artificial intelligence to scour the earth for undiscovered deposits of minerals critical to the energy transition. Lithium and nickel are both crucial to make rechargeable batteries used in electric vehicles.

Yet Namibia isn’t known for producing either — the southwest African nation is better known as one of the world’s biggest sources of uranium.


“This is why we’re exploring,” Makayi said. “Because it’s not known doesn’t mean the opportunities to look deeper are not there.”

KoBold is still doing early-stage prospecting and field exploration before it starts drilling, she said.

CHILE

Wealth Minerals and the Quechua Indigenous Community of Ollagüe Sign Agreement to Jointly Develop the Kuska Lithium Project

February 3, 2025

FOR IMMEDIATE RELEASE…Vancouver, British Columbia: Wealth Minerals Ltd. (the “Company” or “Wealth”) – (TSXV: WML; OTCQB: WMLLF; SSE: WMLCL; FSE: EJZN) and the Quechua Indigenous Community of Ollagüe (“CIQO”), collectively the “Parties”, have agreed (the “Agreement”) to form a joint venture company (the “JV”) to develop the Kuska Lithium Project (“Kuska”) on the territory of the Ollagüe Salar.

The Agreement considers that CIQO will make their best efforts to promptly work with the Wealth team to establish a Chilean legal entity to serve as the JV, and CIQO will own a 5% free-carried interest in the JV and have the right to one of five director seats on the Board of Directors of the JV.  Both Wealth and CIQO believe this structure is the right balance to bring Kuska to production and ensure the highest standards of community participation and transparency. The Parties have also discussed the JV developing new projects in the CIQO general area of interest where there may be synergies with Kuska.

The Kuska Project is located in the Ollagüe Salar, Antofogasta region, northern Chile, and is presently 100% owned by Wealth Minerals and royalty-free. The maiden resource report published by Wealth Minerals Ltd. (see press release January 17, 2023 and Technical Report of January 13, 2023 “Estimated Lithium Resources Ollagüe Project” posted on SEDARPlus) estimates 741,000 tons Lithium Carbonate Equivalent (“LCE”) indicated resources grading 175 mg/L (plus 701,000 tons LCE inferred resources grading 185 mg/L) with an average indicated lithium grade of 175mg/l. On January 4, 2024, Wealth announced the key highlights of a PEA produced by DRA Global Limited. The PEA describes the Kuska Project development towards a 20,000 metric tpa LCE output and an anticipated Life of Mine (“LOM”) of 20 years. The Kuska Project in the PEA estimates a Pre-Tax NPV10% of US$1.65 bn and a 33% IRR. The PEA was filed on SEDARPlus on February 16, 2024.

On September 30, 2024, the Government of Chile announced that the Strategic Council of the Lithium and Salt Flats Committee (“Strategic Council”) had approved a first group of six locations for the development of lithium projects in Chile, which included the Ollagüe Salar. The decision was based on all six locations having favorable conditions for the feasibility of a lithium operation. The decision of the Strategic Council means that Kuska will be prioritized to receive a special lithium operation contract (“CEOL”) by the State of Chile (see press release of September 30, 2024).

Regarding the Agreement, Henk van Alphen, CEO of Wealth Minerals Ltd. commented: “We have been working on the base of this agreement for several years and we are confident that the only way to do mining is by effectively incorporating communities into the business and project activities. We plan to continue advancing the development of Kuska, indeed to now accelerate the pace, so that we can soon build a lithium production operation at Ollagüe.”

For his part, Víctor Nina Huanca, President of the Quechua Indigenous Community of Ollagüe, indicates “The association with Wealth Minerals for the Kuska project will allow the Community to be involved in the development of the project, making decisions and guiding the care and protection of the most vulnerable sectors of our territory, ensuring that everything is done with the highest standards. Respect for our worldview and the environment will be key to carrying out this process. We trust that we will be able to continue moving forward together for the good of Chile, the Antofagasta Region and the Community of Ollagüe. This JV initiative, the first of its kind in Chile, gives the Quechua Community of Ollagüe important leadership in the new development agenda of the indigenous peoples of Chile, in which the community acts empowered, directly managing its territory.”

About Wealth Minerals Ltd.

Wealth is a mineral resource company with interests in Canada and Chile. The Company’s focus is the acquisition and development of lithium projects in South America.

The Company opportunistically advances battery metal projects where it has a peer advantage in project selection and initial evaluation.  Lithium market dynamics and a rapidly increasing metal price are the result of profound structural issues with the industry meeting anticipated future demand. Wealth is positioning itself to be a major beneficiary of this future mismatch of supply and demand. In parallel with lithium market dynamics, Wealth believes other battery metals will benefit from similar industry trends.

For further details on the Company readers are referred to the Company’s website (www.wealthminerals.com) and its Canadian regulatory filings on SEDAR at www.sedarplus.ca.

On Behalf of the Board of Directors of

WEALTH MINERALS LTD.

Facebook – https://www.facebook.com/WealthMineralsLtd
Linkedin – https://www.linkedin.com/company/wealth-minerals
Twitter – https://www.twitter.com/WealthMinerals

 Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release, which has been prepared by management.