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Secret Meeting Between Venezuela and the U.S. as Oil Sanctions Loom

U.S. and Venezuelan government officials met secretly this week ahead of the expiry of oil sanction relief next week. The meeting, in Mexico City, discussed the possibility of reforms in Venezuela, Bloomberg reported citing unnamed sources, with a focus on elections.The United States granted a six-month oil sanction waiver to Caracas last year after the two sides discussed election reforms that would have given Venezuela’s opposition a chance in the upcoming vote in July. However, just months later, the Maduro government effectively banned the opposition’s leader, Maria Corina Machado, from running for office, prompting threats from Washington that the sanctions would snap back. Following the sanction waiver last October, Venezuela had planned to expand its oil production from below 800,000 bpd to over 1 million bpd. The prospects of that happening have dimmed since then as the threat of the return of sanctions hung over PDVSA’s head. Analysts have also forecast a higher risk of domestic fuel shortages if the sanctions snap back on April 18.

The easing of the sanctions helped Venezuela boost its oil export revenues, with expectations for this year at $20 billion, according to Reuters estimates from January, versus a total of $12 billion in oil revenues for last year. If the sanctions are reimposed, however, the outlook will change drastically.

Bloomberg cited one Venezuela-based analyst as estimating the potential losses at $2 billion for this year alone. Another said that the lifting of the sanctions for six months has boosted the country’s oil revenues by an additional $740 million.

The return of sanctions will also affect the U.S. as it would put an end to heavy crude imports from Venezuela. These started flowing to Gulf Coast refineries once again after the sanction suspension entered into effect in October. The suspension expires on April 18.

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China Exports Drop More Than Expected in Setback to Recovery

China’s exports slumped in March, dealing a blow to hopes that booming sales abroad will offset weak demand at home and drive growth in the world’s second-largest economy.

Exports shrank 7.5% in dollar terms in March from a year earlier, while imports fell 1.9%, the customs administration said Friday. Both numbers came in well below economist forecasts. The trade surplus for the month was almost $59 billion.

What Bloomberg’s Economists Think…

Early indicators of overseas demand point to some resilience in coming months, which is “a positive for economy but it doesn’t look strong enough to offset weakness in domestic demand.

The surprise decline in imports is also instructive. Policymakers will have to do more heavy lifting to revive demand.”

— Eric Zhu, economist

In manufactured goods including cars and semiconductors — two areas where Western nations are trying to fend off Chinese competition — exports recorded double-digit growth in dollar terms in the first three months of the year. Phone sales declined when measured in dollars, but the actual number of phones shipped overseas rose 6.3% — illustrating how Chinese firms are slashing prices.

Among other products, fertilizer exports led the decline with a 52% plunge in the first quarter from a year ago. That likely reflected Beijing’s effort to secure domestic supplies and stabilize prices. Chinese export prices fell through February, and that deflation means any rise in demand may not translate into higher profits for Chinese firms. Producer prices fell in March for an 18th straight month.

Meanwhile the unexpected drop in imports adds to worries that Chinese consumers, still feeling the impact of an extended real estate slump, have little appetite to spend. Earlier this week, the government reported that consumer prices barely rose in the 12 months through March, highlighting that deflation remains a threat. NN: Well that shoots in the ass any chance of a increase in China oil demand. In fact just the opposite

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IEA trims oil demand forecast on weakness in wealthier countries

LONDON, April 12 (Reuters) – The International Energy Agency (IEA) trimmed its forecast for 2024 oil demand growth on Friday, citing lower than expected consumption in OECD countries and a slump in factory activity. The Paris-based energy watchdog lowered its growth outlook for this year by 130,000 barrels per day (bpd) to 1.2 million bpd, adding that the release of pent-up demand by top oil importer China after easing COVID-19 curbs had run its course.“Delivery data for many countries came in on the soft side, as unusually warm late-winter weather curtailed OECD heating fuel use by more than normal,” the IEA said in its monthly oil report.
“Additionally, the protracted factory slump in advanced economies continued to depress demand for industrial fuels.”
Demand growth in 2025 will edge down to 1.1 million bpd, with global GDP growth forecast to remain steady and electric vehicle expansion expected to gather pace, it said.
The IEA noted that China’s contribution to the global increase in oil demand is set to weaken from 79% in 2023 to 45% in 2024 and 27% next year.

The agency’s report came after crude futures soared to five-month highs last week-with Brent crude breaking above $90 a barrel, boosted by fears of supply disruptions due to growing geopolitical hostilities and signs of a tighter market following OPEC+ extension of output cuts. Yet, gains are capped by an unexpected build in U.S. inventories and fading expectations that the Federal Reserve will start cutting interest rates in June after a hotter-than-expected U.S. inflation reading. The international benchmark currently trades around $90 a barrel, while WTI, the U.S. oil gauge, is around $86 a barrel.

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USA Crude Oil Stocks Rise Almost 6MM Barrels WoW

U.S. commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve (SPR), increased by 5.8 million barrels from the week ending March 29 to the week ending April 5, according to the U.S. Energy Information Administration’s (EIA) latest weekly petroleum status report. The country’s crude oil stocks stood at 457.3 million barrels on April 5, 451.4 million barrels on March 29, and 470.5 million barrels on April 7, 2023, the report, which highlighted that data may not add up to totals due to independent rounding, showed. Crude oil in the SPR stood at 364.2 million barrels on April 5, 363.6 million barrels on March 29, and 369.6 million barrels on April 7, 2023, the report revealed. Total petroleum stocks in the U.S. – including crude oil, total motor gasoline, fuel ethanol, kerosene type jet fuel, distillate fuel oil, residual fuel oil, propane/propylene, and other oils – stood at 1.591 billion barrels on April 5, the report highlighted. This figure was up 13.0 million barrels week on week and down 12.5 million barrels year on year, according to the report. “At 457.3 million barrels, U.S. crude oil inventories are about two percent below the five year average for this time of year,” the EIA noted in its report. “Total motor gasoline inventories increased by 0.7 million barrels from last week and are about three percent below the five year average for this time of year,” it added.“Both finished gasoline and blending components inventories increased last week. Distillate fuel inventories increased by 1.7 million barrels last week and are about five percent below the five year average for this time of year,” it continued. “Propane/propylene inventories decreased by 0.1 million barrels from last week and are nine percent above the five year average for this time of year,” it went on to state. In its report, the EIA highlighted that U.S. crude oil refinery inputs averaged 15.8 million barrels per day during the week ending April 5. The organization pointed out that this was 115,000 barrels per day less than the previous week’s average. “Refineries operated at 88.3 percent of their operable capacity last week,” the EIA said in the report. “Gasoline production decreased last week, averaging 9.4 million barrels per day. Distillate fuel production increased last week, averaging 4.6 million barrels per day,” it added. U.S. crude oil imports averaged 6.4 million barrels per day last week, the EIA noted in the report, highlighting that this was a reduction of 183,000 barrels per day from the previous week. “Over the past four weeks, crude oil imports averaged about 6.5 million barrels per day, 4.8 percent more than the same four-week period last year,” the EIA stated in the report. “Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 730,000 barrels per day, and distillate fuel imports averaged 163,000 barrels per day,” it added. The EIA revealed in the report that total products supplied over the last four-week period averaged 20.0 million barrels a day. It outlined that this was down by 0.4 percent from the same period last year. “Over the past four weeks, motor gasoline product supplied averaged 8.8 million barrels a day, down by 2.7 percent from the same period last year,” the EIA said in the report. “Distillate fuel product supplied averaged 3.6 million barrels a day over the past four weeks, down by 8.9 percent from the same period last year,” it added. “Jet fuel product supplied was up 3.5 percent compared with the same four-week period last year,” it continued.

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Iran’s response to Israel to reportedly be limited

Iranian Foreign Minister Hossein Amir-Abdollahian told his German counterpart Annalena Baerbock that Tehran will be responding to Israel’s strike on its embassy in Damascus in a limited manner, Axios reported on Thursday citing a source. According to the source, the Iranian official told Baerbock that a “legitimate self-defense with the aim of punishing the aggressor is a necessity,” although the country’s actions will be executed in an “appropriate” way that would not lead to an escalation of the conflict in the region. The source, however, cautioned that it is unclear what would be a definition of a limited response for Iran.

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Israel vows proper response if Iran launches direct attack

Israeli Defense Minister Yoav Gallant  on Thursday held a phone call with the United States Defense Secretary Lloyd Austin and warned that his country will respond appropriately to a potential direct Iranian attack. “Gallant told Secretary Austin that he is committed to the security of the citizens of Israel, and therefore a direct Iranian attack on Israeli territory will require an appropriate Israeli response against Iran,” Israeli minister’s office reported. Previously, Israel Defense Forces (IDF) spokesperson Daniel Hagari stated that his country is “on alert” and that a strike from Iran’s territory would mean that Tehran aims to “escalate the situation in the Middle East and to stop hiding behind the proxies.”

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Iran reportedly postponed strike on Israel at last minute

Iran was planning to conduct a strike against Israel but postponed such action “at the last minute,” Israeli news website Ynet reported on Thursday. According to the report, Tehran decided to either delay the strike or change the nature of its response to Israel’s attack on its consulate in Damascus, likely due to warnings from the administration of United States President Joe Biden. The outlet cited Iranian semi-official news agency Mehr as claiming the attack could happen “maybe tonight,” but soon after deleting the video with the assertion. Iran has warned on multiple occasions that it will “punish” Israel over the Damascus strike in which seven members of the Islamic Revolutionary Guard Corps (IRGC), including Quds Force commander Mohammad Reza Zahedi and his deputy Mohammad-Hadi Haji-Rahim, were killed. Israel, on the other hand, stressed it would retaliate against any strike, while Biden insisted Washington will do everything it can to protect Israel’s security. NN: Once Iran the US has Israel’s  back they called off the strike.

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Biden Says He’s Watching Netanyahu After Their ‘Blunt’ Talk

President Joe Biden said he delivered a “blunt and straightforward” message to Israeli Prime Minister Benjamin Netanyahu on improving civilian conditions in Gaza. “We’ll see what he does in terms of meeting the commitments he made to me,” Biden said Wednesday during a White House news conference with Japanese Prime Minister Fumio Kishida. Biden also urged the adoption of a proposal that would see a six-week cease-fire in exchange for the return of hostages being held by Hamas, saying the US remained committed to seeing their release. “We’re not going to stop until we do,” he said.The Israel-Hamas war, now in its seventh month, has weighed heavily on Biden’s reelection bid. The president signaled a breaking point last week, telling Netanyahu that US support for his war effort would depend on better protecting civilian lives in Gaza. Biden on Wednesday also called for Israel to open an additional crossing and allow more aid trucks to enter the war-torn region. An Israeli strike that killed seven aid workers delivering food to Palestinians prompted the call between Biden and Netanyahu. The incident caused a global backlash and ramped up pressure on Biden to persuade Israel to allow more aid to flow into the devastated territory. The Israeli military has said the attack inadvertently targeted the aid convoy. Young voters, progressives and people of color — all crucial groups for Democrats — have increasingly voiced opposition to Biden’s handling of the conflict and urged him to place conditions on support for Israel or entirely cut off military assistance. The president can ill-afford defections in his November rematch with Republican Donald Trump. Israeli officials this week said progress had been made in negotiations for a cease-fire in Gaza that would see the release of hostages held by Hamas, designated a terrorist group by the US and European Union, and Palestinian prisoners. It’s a shift in tone from the nation’s leaders, who had previously said large gaps remained between the two sides. Netanyahu said Monday that he had a date in mind to invade the city of Rafah — seen as the last bastion of Hamas and its leaders, but also where more than 1 million Palestinians fled during the war. Such a move would further strain US-Israeli relations. The White House has said it couldn’t support a full-scale ground invasion of Rafah, given the likelihood of widespread civilian deaths.Biden urged Netanyahu during their call last week to reach an immediate cease-fire deal to allow for hostages to be freed and more aid to reach Palestinians in Gaza. The White House has praised initial steps to boost the flow of shipments of food and medicine into the territory, but officials have said they want to see those efforts continue for a sustained period to satisfy their concerns. Israeli Defense Minister Yoav Gallant said Wednesday that the country is greatly intensifying its humanitarian aid to civilians in Gaza, partly at the urging of the US, bringing the number of trucks entering the strip to 500 a day. Through most of the conflict, the number was about 200.“My recent visit to the United States was essential in determining next steps and reflecting the link between our operational goals and the humanitarian effort,” he told a group of foreign correspondents in his Tel Aviv office. Gallant announced that Israel is opening its port at Ashdod to receive goods to enter Gaza through a new northern entry it was creating. In addition, new aid routes from Jordan have been approved, as well as a deconfliction mechanism to reduce the risk of another mistaken killing as occurred last week with the seven aid workers. Israel is also working to fix bombed-out infrastructure, including installing new water lines he said.

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Three sons of Hamas leader killed in airstrike……Hamas can’t  find 40 Israeli hostages needed for cease fire deal

Three sons and three grandchildren of Ismail Haniyeh, a senior Hamas leader and former Palestinian Authority prime minister, were killed in an airstrike, Haniyeh confirmed in an interview with Al Jazeera on Wednesday. According to Haniyeh, the victims were visiting relatives on the occasion of Eid in the Shati refugee camp in northern Gaza when they were attacked. In addition, he also confirmed the loss of three grandchildren in the same attack. Moreover, the news comes after the Hamas-run Gaza Health Ministry claimed that 33,500 Palestinians have been killed since the start of the war and 76,049 have been wounded.

Hamas can’t  find 40 Israeli hostages needed for cease fire deal

CNN — 

Hamas has indicated it is currently unable to identify and track down 40 Israeli hostages needed for the first phase of a ceasefire deal, according to an Israeli official and a source familiar with the discussions, raising fears that more hostages may be dead than are publicly known. The framework that has been laid out by negotiators says that during a first six-week pause in the fighting, Hamas should release 40 of the remaining hostages, including all the women as well as sick and elderly men. In exchange, hundreds of Palestinian prisoners would be released from Israeli prisons. Hamas has told international mediators – which include Qatar and Egypt – it does not have 40 living hostages who match those criteria for release, both sources said. CNN’s record of the conditions of the hostages also suggests there are fewer than 40 living hostages who meet the proposed criteria. The inability – or unwillingness – of Hamas to tell Israel which hostages would be released, alive, is a major obstacle, the second source added. With Hamas appearing to be unable to reach 40 in the proposed categories, Israel has pushed for Hamas to fill out the initial release with younger male hostages, including soldiers, the Israeli official said. Throughout the months of negotiations since the last ceasefire Israel has repeatedly asked for a list of the hostages and their conditions. Hamas has argued that it needs a break in the fighting to be able to track and gather down the hostages, the same argument it made in November before a week-long pause that broke down after Hamas failed to deliver more hostages. The majority of the almost 100 hostages who remain alive are believed to be male IDF soldiers or men of military reserve age. Hamas is expected to try to use to them in later phases to try to negotiate more significant concessions, including more high-level prisoners and a permanent end to the war. The more than 250 hostages captured or killed on October 7 are believed to have been spread out among different members and factions of Hamas, as well as other militant groups, gangs and even held by families.

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US Sees Imminent Missile Strike on Israel by Iran, Proxies……..Biden: US to do everything to protect Israel’s security

Israel’s Western allies have been told Israeli government and military facilities may be targeted but civilian facilities are not expected to be, they said. US officials are helping Israel on planning and sharing intelligence assessments, the people said. Israel has told allies it is waiting for this attack to take place before launching another ground offensive against Hamas in Rafah in Gaza, though it’s not clear how soon that operation may begin. US and Western intelligence indicates an attack from Iran and its proxies may not necessarily come from Israel’s north, where Tehran’s ally Hezbollah in Lebanon is located, the people said. Israeli officials are in agreement with the allied view. They’ve also publicly threatened Iran that if it hits Israeli soil, Israel will hit Iranian soil. Iran’s Supreme Leader Ayatollah Ali Khamenei repeated a vow to retaliate against Israel for the Damascus strike, which he said was tantamount to an attack on Iranian territory. Foreign diplomatic missions already are preparing for the potential strikes, making contingency plans for evacuation amid requests from Israeli authorities about emergency supplies like generators and satellite phones, one of the people said, noting that they were not aware of any western missions planning immediate evacuation. While the US has pushed Israel for a cease-fire in Gaza, the Biden administration has also signaled it’s prepared to back the country in the event of an attack by Iran or its proxies. “We also want to address the Iranian threat to launch a significant – they’re threatening to launch a significant attack in Israel,” President Joe Biden said Wednesday. “As I told Prime Minister Netanyahu, our commitment to Israel security against these threats from Iran and its proxies is iron clad. Let me say it again, iron clad – all we can to protect Israel’s security.”

It’s not yet clear whether a potential attack by Iran and its proxies would turn the conflict into a broader, more prolonged war or remain contained, one of the people said. A direct Iranian strike on an Israeli city would be a first and intensify hostilities in a major way. Last week, Israel scrambled navigational signals over the Tel Aviv metropolitan area in preparation for a potential attack.

Israeli embassies have also been considered targets for potential attacks in the wake of the strike on Damascus last week, with several missions around the world shuttered. Iran’s main proxy group is Hezbollah, which is based in southern Lebanon and has been trading fire with Israeli forces almost daily since the war in Gaza erupted in October. Since the start of the war, tens of thousands of people have been evacuated from northern Israel and southern Lebanon.

Biden: US to do everything to protect Israel’s security

United States President Joe Biden underlined on Wednesday that Washington will do all it can to protect Israel’s security. “We want to address the reigning threat. As I told [Israeli] Prime Minister [Benjamin] Netanyahu our commitment to Israel’s security against these threats from Iran and its proxies is ironclad,” Biden said at a joint press conference with Japanese Prime Minister Fumio Kishida. Both sides called for a ceasefire and a hostage deal.