Tuesday, November 18, 2025

Iran's Water Crisis Is a Worrying Sign of Things to Come

By Kurt Cobb - Nov 17, 2025

Tehran faces unprecedented drought conditions, prompting warnings of water rationing and even potential citywide evacuation if rains fail to arrive.
Urban water shortages often draw public scrutiny, yet agriculture and thermoelectric power remain the dominant water consumers worldwide.
Similar crises - from Cape Town’s Zero Day to rising water stress across U.S. cities - reveal how outdated infrastructure is collapsing under climate-driven pressures.

I've put the word "evacuation" in the title of this piece in quotes because it's not clear where Tehran's 9.8 million people, or some significant number of them, would evacuate to as water supplies run dangerously low. Iranian President Massoud Pezeshkian has been criticized for saying out loud how bad the situation is: "If it does not rain in Tehran by December, we should ration water; if it still does not rain, we must empty Tehran."

Doubtless, Iranian water authorities will force severe restrictions on Tehran's residents if the rains—which have been 82 percent below the long-term averages for the past year—do not come. And there is almost certainly room to conserve. But the relentless heat (and thus increased evaporation from reservoirs) and lack of rain are not something that can be put down to water system mismanagement unless (as you should) you count not understanding and reacting to climate change as a failure of management.

Back in 2018, Cape Town, South Africa, was facing a severe water shortage for a lack of rain, during which the city began making announcements of a specific date, which it called "Zero Day", when water would have to be shut off to most of the city. Dramatic conservation, which drove water consumption down 30 percent, and the return of seasonal rains saved the city (for now).

Wherever water is in short supply in urban areas, the subject of overuse becomes a hot topic. But, agriculture and thermoelectric (mostly coal and natural gas) power generation are typically the largest users, taking 43 percent and 42.5 percent, respectively, of total water withdrawals in the United States, for example, from 2010 through 2020, according to the U.S. Geological Survey. What may be surprising to most people is that what's called "public supply," the water that comes out of taps of homes and businesses, amounts to just 14.5 percent of consumption. When water gets short, squeezing "public supply" may be useful, but far less important than addressing agricultural and power generation use over the long run.

Situations similar to what happened in Cape Town and what is happening in Tehran are now increasingly repeating themselves across the globe. Here's a recent headline: "13 U.S. Cities Facing Alarming Water Shortages That Are Being Ignored." Those cities include ones you might expect, such as Phoenix, Las Vegas, and Los Angeles, and ones you probably wouldn't such as Salt Lake City, Denver and Atlanta. In some cases, dwindling supply looms large, as in, for example, the shrinking Colorado River, which supplies Phoenix with much of its water. In others, it's rapid development, which is increasingly taxing supply, such as in Colorado Springs. In truth, both dwindling supply and rapid development play a role in water difficulties in most cases.

Here's another headline: "25 Countries, Housing One-Quarter of the Population, Face Extremely High Water Stress." The five most water-stressed countries, not surprisingly, are in or near the Middle East: Bahrain, Cyprus, Kuwait, Lebanon, Oman, and Qatar. Some not-so-likely candidates for the extremely stressed category include Chile, Belgium, and Greece. The World Resources Institute, which wrote the study linked above, defines water stress as follows: "Water stress, the ratio of water demand to renewable supply, measures the competition over local water resources. The smaller the gap between supply and demand, the more vulnerable a place is to water shortages."

Nearly everywhere, climate change is challenging water managers who are often dealing with systems built in the last century and before that have been expanded willy-nilly without climate change in mind. If Tehran does start to empty out due to water shortages sometime next year, it will be a stark reminder that the systems we built pre-climate change are dangerously ill-adapted to the new and increasingly hostile climate.

By Kurt Cobb via Resources Insights

Reliance Snaps Up Kuwaiti Crude as India Shuns Sanctioned Russian Oil

By Tsvetana Paraskova - Nov 18, 2025

India’s Reliance Industries, the top private refiner in the country, has bought 1 million barrels of crude from Kuwait, trade sources told Reuters on Tuesday, as most Indian refiners halt purchases from Russia after the U.S. sanctions on the top Russian oil producers and exporters.

Reliance Industries of Indian billionaire Mukesh Ambani has bought the Kuwaiti crude via a tender issued last week by the national Kuwait Petroleum Corporation (KPC), according to Reuters’ sources.

KPC sought buyers in a tender for 500,000 barrels of Kuwait Heavy and 500,000 barrels of Eocene crude after Kuwait’s Al-Zour refinery couldn’t process these volumes due to unplanned maintenance following a fire.

The Kuwait Heavy and Eocene cargoes are loading between December 6 and 9 and were awarded to Reliance Industries, Reuters’ sources said.

Reliance has been a major buyer of crude from the Middle East and Russia in recent years. After the U.S. sanctions on Russia’s top oil firms Rosneft and Lukoil last month, the Indian refiner snapped up millions of barrels of crude from the Middle East as it said it would comply with the Trump Administration’s sanctions.

Reliance, which operates the world’s biggest refinery complex at Jamnagar with 1.4 million barrels per day (bpd) of processing capacity, has a long-term deal with Rosneft to buy almost 500,000 bpd. Reliance was India’s single biggest buyer of Russian crude, until now.

Reliance typically does not import crude from sanctioned entities and is unlikely to risk secondary U.S. sanctions by continuing imports from Rosneft, as the Indian conglomerate is a listed entity with access to the U.S. banking system, sources familiar with the company told the Financial Times at the time.

Even before the U.S. sanctions were announced, Reliance had accelerated crude oil purchases from the Middle East and had been more active than usual in procuring oil from the Gulf region.

All but two Indian refiners have skipped placing orders for Russian crude for December after the U.S. sanctioned Rosneft and Lukoil, sources with knowledge of the purchases told Bloomberg last week.

By Tsvetana Paraskova for Oilprice.com

LNG Tanker Rates Soar on Booming U.S. Exports

By Irina Slav - Nov 18, 2025

LNG carrier rates for the Atlantic route between the U.S. and Europe have surged close to a two-year high on strong demand for American liquefied gas as Europe fills up its storage ahead of winter.

The spot rate hit $98,250 per day on Monday, Bloomberg reports, which was a 19% increase and the highest in over a year, according to price trackers. The European Union’s gas storage is now 81.94% full, which is less than the 90% target the bloc had for November, before the winter colds begin. Most of the gas that the EU uses in winter comes from the United States.

With surging freight rates, demand from Asia will weaken, analysts commented to Bloomberg, although some noted the rate increase is close to peaking and much higher prices were unlikely.

Asia, which used to be the global driver of LNG demand until recently, is now in retreat, with Europe replacing it, especially as a destination for U.S. liquefied gas. LNG imports to Asia last month stood at 22.84 million tons, according to Kpler data.

This was a slight increase from September but palpably lower than October 2024, when imports hit 24.39 million tons. Over the first ten months of the year, Asia’s imports of liquefied gas were down by over 14 million tons on the year to 225.8 million tons. China was one driver of this trend, booking year-on-year LNG import declines every month since November 2024.

LNG imports into Europe, meanwhile, moved in the opposite direction. Over the first ten months of the year, Europe imported 101.38 million tons of the superchilled fuel. This was 16.75 million tons more than what Europe imported a year earlier—even as the EU leadership boasted about permanently reducing the bloc’s consumption of natural gas, not just from Russia but in general.

LNG Exports Will Drive Explosion in U.S. Natural Gas Consumption

By Irina Slav - Nov 17, 2025

The U.S. LNG industry is already growing at breakneck speed, but it may just be the beginning of even more substantial growth.
Analysts predict a slump in LNG prices next year as a consequence of all that new supply coming on stream.
A new wave of LNG export capacity in both the US and Qatar is set to jolt gas consumption.

The expected surge in liquefied natural gas export capacity in the United States is on course to boost gas consumption significantly, from around 18 billion cu ft right now to as much as 40 billion cu ft—and that 18 billion cu ft is already an all-time high.

The United States turned into the world’s largest exporter of LNG in a matter of years as energy companies raced to build new liquefaction trains along the Gulf Coast in response to the surge in demand for a lower-emission alternative to coal. Last month, the U.S. became the first country to export 10 million tons of liquefied gas in a single month, enjoying solid demand from Europe, which earlier this year signed a commitment to buy significant volumes of both LNG and oil to get President Trump to lower tariffs.

So, the U.S. LNG industry is already growing at breakneck speed, but it may just be the beginning of even more substantial growth, at least according to a senior executive of one of the biggest players in that field. That, in turn, could see higher natural gas prices at home.

Speaking at a recent industry event, Cheniere Energy’s chief commercial officer, Anatol Feygin, forecast the surge in natural gas demand from LNG plants from 18 to 40 billion cu ft and said this would drive natural gas prices higher, after they swelled by as much as 62% over the past year for the very same reason.

“You kind of saw that in 22/23 coming out of COVID. LNG went back up to full utilization and then grew, so Nymex had an incursion into the high single digits. Very quickly supply responded,” Feygin said, as quoted by Reuters, suggesting natural gas producers are about to get braver with production expansion.

They may yet remain cautious, however, as analysts predict a slump in LNG prices next year as a consequence of all that new supply coming on stream, thanks to U.S. energy companies seeking to get a piece of the global LNG demand pie. Per these predictions, the global supply of liquefied gas would exceed demand growth, depressing prices. On the other hand, cheaper LNG would boost demand in energy-importing countries that are price-sensitive, such as Pakistan, for instance, or Bangladesh.

In fact, Cheniere’s Feygin said he expected the world to need a lot more new LNG production capacity in the coming year, record new supply from the U.S. notwithstanding, because of healthy demand growth—notably from the price-sensitive importing countries. The executive has pegged the necessary production capacity growth at an annual 30 million tons.

Of course, it is only natural for an industry to predict a bright future for its product. But Feygin and other executives are not the only ones seeing a surge in demand for natural gas in liquefied form. One analyst recently forecast that the United States could see its LNG capacity double between now and 2030 in response to global demand trends.

“In general terms, we are going to nearly double capacity from roughly 15.5 billion cubic feet per day (Bcf/d) now to over 30 Bcf/d by 2030,” Jack Weixel, senior director at East Daley Analytics, said as quoted by CME Group earlier this month. “If all projects proceed as planned, we should have at least 25 Bcf/d by 2028.”

This is a lot of new demand for gas, with analysts estimating the increase in LNG exports at 75% by that year. Such a development will inevitably push natural gas prices higher, while Big Tech’s AI push adds even more demand for the fuel, also driving prices higher. Indeed, record demand for U.S. LNG from Europe has already pushed prices to the highest in two years, CME Group noted in a report on the coming LNG boom. The average price enjoyed by U.S. LNG exporters this year has been $8 per thousand cu ft, according to data from the Energy Information Administration.

There is, however, one slightly inconvenient question that the current LNG situation raises, and that question is how long Europe would be able to afford U.S. LNG, especially with prices set to rise further in the coming years along with additional supply because of demand growth. Then there is something else: new gas production may become costlier, some warn, because gas producers are running out of the top-tier acreage, just like oil drillers. Others, however, are not worried, noting there was plenty of untapped gas underground, so supply response to demand developments would be speedy and keep prices from rising too high.

It seems, then, that the stage is set for a real LNG boom in the coming years—and it will not be just taking place in the U.S. because Qatar plans to have export capacity of 126 million tons annually by 2027. This will no doubt exert some downward pressure on prices, a very welcome development to price-sensitive LNG importers.

By Irina Slav for Oilprice.com

CRIMINAL CAPITALI$M

Mozambique LNG Project Restart Faces New War Crimes Allegations

By Tsvetana Paraskova - Nov 18, 2025

The European Center for Constitutional and Human Rights (ECCHR) said on Tuesday it had filed a criminal complaint in France against TotalEnergies for complicity in war crimes, torture, and enforced disappearance at the Mozambique LNG site in 2021.

According to the NGO’s complaint, the French supermajor “is accused of having directly financed and materially supported the Joint Task Force, composed of Mozambican armed forces, which between July and September 2021, allegedly detained, tortured and killed dozens of civilians on TotalEnergies’ gas site.”

The European NGO has filed the complaint with the French National Anti Terrorism Prosecutor (PNAT), which also has a mandate to investigate international crimes.

The ECCHR claims that TotalEnergies knew of human rights violations committed by armed forces before the massacre.

The complaint is being filed just as TotalEnergies lifted the four-year-long force majeure on the Mozambique LNG project, which was stalled due to the precarious security situation near the site of the planned $20-billion export facility.

TotalEnergies has been accused several times of being complicit in violence at the site or near it, but the French group has rejected it had any knowledge of such incidents.

Following a Politico article last year, which is the basis for the new complaint by the ECCHR, TotalEnergies published the response of Mozambique LNG regarding the alleged violence.

“Mozambique LNG would like to clearly state that it has no knowledge of the alleged events described in your “Story Summary” and has never received any information indicating that such events took place,” the company operating the project said in September 2024 in response to the article.

TotalEnergies and its partners appear to be close to restarting the development of the project in Mozambique, which hinges on Mozambican government approval and an updated budget and schedule. The goal to achieve first LNG production has slipped, first to 2027, and later, to 2029.

By Tsvetana Paraskova for Oilprice.com

TotalEnergies to Appeal French Antitrust Fine Over Corsica Fuel Supply

By Charles Kennedy - Nov 18, 2025

TotalEnergies (TTE) said it will appeal a decision by France’s Competition Authority that fined the company for allegedly restricting access to petroleum product depots in Corsica—an accusation the company firmly disputes after years of investigation.

The regulator’s ruling centers on a 2016 contractual clause governing access to shared oil depots on the island. According to TotalEnergies, the clause allowed depot shareholders priority access but did not block non-shareholder distributors, who could still obtain fuel under separate contractual arrangements. The company insists the Authority failed to demonstrate any measurable anti-competitive impact, either on the local distributor that filed the complaint or on consumers.

The French Competition Authority concluded that the depot-access clause constituted an anti-competitive practice and issued a fine. TotalEnergies argues the finding lacks evidentiary support, noting that the complaining distributor maintained its retail footprint, increased fuel volumes, and sourced product from multiple suppliers throughout the period under review.

The ruling closes a four-year inquiry involving multiple hearings and site inspections. Fuel logistics in Corsica are particularly sensitive due to the island’s geographic isolation, high transport costs, and limited infrastructure. TotalEnergies has been one of Corsica’s main suppliers for six decades and currently operates 47 service stations across the island, including rural sites that depend heavily on stable supply.

The company also highlighted recent fuel-price measures it implemented to support local purchasing power, including a €0.20-per-liter discount in 2022 and a price cap of €1.99 per liter that remains in effect.

TotalEnergies says it “struggles to see” how its behavior could be deemed anti-competitive given the supply dynamics and the absence of consumer harm. The company will challenge the ruling before the Paris Court of Appeal.

In a notable escalation, TotalEnergies warned that the fine is disproportionate relative to the profitability of its Corsican marketing operations. As a result, it has launched a strategic review that could reshape—or potentially curtail—its long-standing downstream presence on the island.

The case comes as European regulators maintain heightened scrutiny over fuel supply chains, market concentration, and pricing practices, especially in island territories where infrastructure constraints can amplify competition concerns. For energy investors, the outcome may influence how multinational suppliers structure joint-infrastructure agreements and regional pricing strategies in constrained markets.

By Charles Kennedy for Oilprice.com

ExxonMobil and BASF Launch Baytown Demo to Scale Low-Emission Hydrogen Tech

By Charles Kennedy - Nov 17, 2025

ExxonMobil and BASF have entered a strategic development agreement to commercialize methane pyrolysis, a low-emission hydrogen technology that produces solid carbon instead of CO?. The collaboration includes plans for a demonstration plant at ExxonMobil’s Baytown complex in Texas—marking one of the most significant pushes yet to scale pyrolysis-based hydrogen for industrial markets.

The companies will co-develop methane-pyrolysis technology and build a facility designed to produce up to 2,000 tons of low-emission hydrogen and 6,000 tons of solid carbon annually. The project aims to validate BASF’s reactor design at scale and accelerate commercial deployment.

Methane pyrolysis has emerged as one of the more promising pathways for “turquoise hydrogen”—a variant that splits methane into hydrogen and solid carbon using electricity, avoiding process CO? emissions and requiring significantly less energy than water electrolysis. The resulting solid carbon can be used in steel, aluminum, construction materials, and battery components, potentially helping offset production costs.

The technology’s appeal is especially strong in regions where carbon capture and storage (CCS) is economically or geologically constrained. ExxonMobil underscored this point, noting that methane pyrolysis complements its wider low-carbon strategy and offers a pathway to low-emission hydrogen without large-scale CO? transport and storage infrastructure.

BASF has spent more than a decade developing methane pyrolysis, supported by German federal R&D funding. Its pilot plant in Ludwigshafen has already validated the core reactor concept, while ExxonMobil brings long-standing expertise in methane-conversion technologies and large-scale project execution. The Baytown demonstration unit represents the next step toward industrial readiness.

Interest in low-carbon hydrogen continues to grow as heavy industry, chemicals, and refining look for decarbonization solutions that can integrate with existing assets. But the market remains split across multiple pathways—blue hydrogen via CCS, green hydrogen via electrolysis, and emerging thermal processes such as methane pyrolysis.

Pyrolysis has gained momentum because it avoids the massive electricity requirements of electrolysis and does not depend on secure CO? storage formations. If ExxonMobil and BASF can demonstrate cost-competitive output at scale, the approach could become an attractive option for industrial clusters tied into natural gas networks.

The Baytown demonstration plant will be critical to proving commercial viability. Success would support wider industrial deployment and potentially give ExxonMobil a scalable hydrogen pathway capable of operating across diverse regulatory environments. For BASF, the collaboration aligns with its strategy to shrink its product carbon footprint and offer customers lower-emission inputs.

As hydrogen markets accelerate—with U.S. policy incentives, European decarbonization targets, and industrial buyers seeking lower-carbon feedstocks—this partnership places both companies at the forefront of an emerging “turquoise hydrogen” segment that could reshape the economics of hydrogen production.

By Charles Kennedy for Oilprice.com

PRICES DON'T LIE

OPEC Chief Accuses Media of “Misrepresenting” 2026 Oil Outlook

By Irina Slav - Nov 18, 2025

OPEC Secretary-General Haitham al Ghais criticized media coverage suggesting the group projected a 2026 oil surplus, insisting its forecast shows a balanced market.
OPEC expects non-member supply to rise by 1.3 million bpd in 2026, while global demand is set to grow by 1.6 million bpd to 106.2 million bpd.
Despite the balanced outlook, most traders surveyed by Bloomberg anticipate OPEC will continue raising production next year following a brief early-2026 pause.

OPEC does not project an oil supply surplus for 2026, the secretary-general of OPEC, Haitham al Ghais, told CNBC today, slamming the media for covering its Monthly Oil Market Report inaccurately.

“There was a misrepresentation by some media about our monthly market report,” al Ghais said, “specifically regarding the messages and a narrative that was being created out of reading some of our numbers. For example, things related to the market being in a surplus next year.”

Indeed, as Oilprice reported last week, OPEC said in its report that it expected the oil market to be in balance next year. The forecast was a revision of an earlier projection about a deficit, however, which prompted a selloff on oil markets and pushed international benchmarks lower.

The group said that oil production from non-OPEC countries would grow faster than expected, adding 1.3 million barrels daily to supply in 2026. Demand, OPEC said, would meanwhile grow at a rate of 1.6 million barrels daily, reaching a total of 106.2 million barrels daily.

In his talk with CNBC, Haitham al Ghais remarked that the Monthly Oil Market Report that OPEC produces is “very basic” and that there was “nothing complex about it”, possibly implying it was difficult to find the information contained in the report hard to understand or interpret, leading to inaccurate reporting.

Meanwhile, despite OPEC’s expectation of a balanced global crude oil market in 2026, analysts expect the group to keep adding production after a short pause at the start of the year, agreed at its latest meeting.

A survey that Bloomberg conducted among 25 traders and analysts earlier this month showed most of them expected more monthly additions to OPEC’s total, with only a handful anticipating a longer pause or even a reversal of the production policy.