Song of Oil and LNG

Oil nears $100 as US launches new strikes on Iranian tankers The US military struck multiple ships linked to Iran’s Revolutionary Guards after further attempted missile attacks on a US Navy warship. The immediate result is a sharper geopolitical risk premium in crude, with oil moving toward $100 as the market prices in a higher probability of disruption tied to direct US-Iran confrontation at sea. For the oil market, the key issue is not only the damage to the specific vessels but the signal that the security environment around regional shipping has deteriorated again. Any escalation involving Iranian-linked tankers raises the perceived risk to flows from the Gulf and to tanker transit, which is enough to tighten prompt pricing even before any confirmed loss of barrels. The market signal is straightforward: until the confrontation shows signs of stabilising, crude will keep carrying a larger geopolitical premium. 🔎 Source @songofoil

🇨🇳 China oil demand to fall 8.9% in 2026, Sinopec research says China's oil demand is expected to fall by 600,000 barrels per day in 2026, or 8.9% year on year, according to Sinopec's research arm. The call points to a third straight annual decline in Chinese oil consumption, with high oil prices weighing on demand while electric vehicle adoption continues to accelerate. For the oil market, this is a clear bearish signal from the world's largest crude importer. A 600,000 bpd drop in China alone is large enough to matter for Atlantic Basin and Middle East exporters, especially if weaker transport fuel demand becomes structural rather than cyclical. The combination of sustained price pressure on consumers and rapid EV penetration suggests the erosion is not limited to a short-term slowdown but increasingly tied to demand substitution. The immediate takeaway is that China is becoming less reliable as the marginal engine of global oil demand growth, raising the bar for producers counting on Asian demand to absorb supply. 🔎 Source @songofoil

OPEC+ freezes October targets as the real negotiation moves to 2027 quotas OPEC+ agreed at its Sept. 6 virtual meeting to keep October oil production targets at September levels, halting further monthly increases after the 188,000 b/d hike for September. Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman said they will maintain required output unchanged through October and continue monthly reviews, with the next meeting set for Oct. 4 to decide November policy. The pause comes after the group completed the rollback of a 1.65 million b/d voluntary cut introduced in 2023, but physical supply has not fully matched higher paper quotas. Disruptions linked to the Iran conflict and constraints affecting flows through the Strait of Hormuz, along with production and export issues in Russia and Kazakhstan, have limited actual barrels reaching the market. The bigger issue now is the 2027 baseline reset: OPEC+ is using sustainable capacity assessments, including work by DeGolyer and MacNaughton, to determine future quotas, a process that risks friction as producers that invested in new capacity push for higher allocations. For the market, October is a holding pattern, but the 2027 baseline fight will matter far more than another token monthly quota adjustment. 🔎 Source @songofoil