1. Exxon inks a $50 billion-dollar deal with Saudi Arabia during Trump’s visit.
Last Saturday the world’s largest oil consumer and the world’s largest oil exporter met and discussed a variety of topics. Fighting terrorism, large arms deals, and significant investments in the US economy were a few of the topics discussed. One point of news that impacts the oil and energy industry is the $50B deal between Exxon and Saudi Basic Industries Corporation. The agreement will help build a $20B chemical complex that will boost job growth on the American Gulf Coast.
The initiative will be called Growing the Gulf, and is projected to create over 35,000 construction jobs and 12,000 full-time jobs once completed. Exxon said project will include 11 major chemical, refining, lubricant and liquefied natural gas projects and the Saudis will help build one of initiative's 11 hubs. Exxon and SABIC selected San Patricio County, Texas, for the proposed petrochemical complex.
2. OPEC will be meeting this week, and considering “deepening” supply cuts.
Oil prices are up today, and most analysts believe they will continue to climb throughout the week leading up to the OPEC meeting. Prices are trending up because expectations that the “supply-cut agreement” between OPEC and other oil producers, including Russia, to cut supplies by 1.8 million barrels per day (bpd) would be extended to March 2018; a change from the original agreement to only cover the first half of this year.
Prices are also increasing based on the news that cuts may not only be stretched into next year but might also deepened to tighten the market and prop up oil prices. The meeting is planned for May 25th in Vienna.
3. Switzerland votes to invest in renewables and move away from nuclear.
Swiss voters turned out to support the government’s plan to invest billions of dollars in subsidies for renewable energy, and simultaneously ban new nuclear plants. Roughly 58% supported the measure on Sunday putting Switzerland in line with other European countries that are taking the same approach. Germany is on track to phase out nuclear power by 2022, and Austria banned it decades ago.
"The results shows the population wants a new energy policy and does not want any new nuclear plants," Energy Minister Doris Leuthard said in public statements following the vote. The new law is anticipated to boost domestic renewable energy, cut fossil fuel use and reduce reliance on imports.