A recent analysis conducted by the European Environmental Bureau (EEB), a Brussels-based nonprofit organization, has revealed that despite the ongoing energy crisis, only half of the European Union (EU) member states have implemented mandatory energy saving measures for the upcoming winter. The majority of these measures remain voluntary and are limited to public buildings. The research conducted by the EEB highlights significant disparities among EU countries in their efforts to reduce gas and electricity consumption. Out of the 27 EU countries, only 14 have adopted mandatory measures to curb energy use. Poland, Lithuania, Cyprus, and the Netherlands have joined this group within the past six months. Countries that were previously reliant on Russian gas imports, such as Italy and Germany, have implemented the most comprehensive gas-saving measures. However, some countries with lower gas dependency, including France and Spain, have also implemented strict measures targeting both the public and private sectors, as well as small businesses and large industries. Conversely, Luxembourg, Austria, Malta, Nordic, and Eastern European states have relatively weaker energy reduction measures in place. Bulgaria, Romania, and Latvia have not introduced any national measures to reduce gas and electricity consumption despite the EU energy crisis, although a third of EU nations were in the same situation as recently as December. Among the EU member states, Portugal stands out as the only country that transparently reports on energy savings implementation and progress. It has established a monitoring committee and provides analysis of specific measures, according to the EEB. Davide Sabbadin, the senior policy officer for climate and energy at the EEB, emphasized that although reduced energy demand during the previous winter resulted in lower energy prices and reduced emissions, the underlying question remains: how was this achieved? Relying solely on unusually mild temperatures and high prices is not a substitute for effective policy. Energy-saving measures are more socially equitable than high prices. Sabbadin further stressed that governments should not burden the most vulnerable citizens with the responsibility for the energy crisis. Mandatory energy reductions for businesses and the public sector can ensure energy savings in a fair and reliable manner. With the possibility that exceptionally favorable conditions for energy savings may not occur again this winter, EU member states need to take bold action. The EEB calls for public monitoring and evaluation of the impact of these measures by the EU.

Multiple adverts released by oil giant Shell have been prohibited in the United Kingdom due to their “misleading” content, as ruled by the Advertising Standards Authority (ASA). The independent regulatory body stated that the advertisements suggested Shell’s production consists of a higher proportion of low-carbon energy products than it actually does in practice. The ASA concluded that the adverts failed to disclose significant information about the overall environmental impact of Shell’s business activities in 2022. Consequently, the ban applies to a TV advert, a poster displayed in Bristol, and a video posted on Shell’s YouTube channel. In response, Shell expressed strong disagreement with the ASA’s decision, claiming that while customers are aware of its hydrocarbon production, they lack awareness of the available alternatives. The banned poster in Bristol featured the statement “Bristol is ready for clean energy” alongside the statistic that 78,000 homes in the south-west of England use renewable electricity. The ASA deemed the text misleading as it implied that all of Shell’s operations provided cleaner energy. The TV advert and the YouTube video also featured the slogan “the UK is ready for cleaner energy.” The ASA noted that the adverts emphasized the word “ready” and mentioned only short-term timeframes, giving the impression that Shell already heavily invested in and sold lower-carbon energy products in the UK or would do so in the near future. Shell argues that it would be disproportionate and unworkable for regulators to demand advertisements from businesses with diverse product portfolios to provide a comprehensive overview of the advertiser’s entire business. ClientEarth, an environmental law charity, hailed the ruling as a significant milestone in the regulation of advertising by high-carbon industries. They emphasized the establishment of the concept of “misleading by omission,” wherein companies engaged in carbon-intensive activities can face bans for focusing their ads on less polluting aspects of their business. Sophie Marjanac, a lawyer at ClientEarth, stated that while they welcomed the ASA’s ruling, further action is necessary to ensure advertising truthfulness and prevent high-carbon businesses from impeding the transition to net-zero emissions.

Eni has entered into exclusive discussions to acquire Neptune Energy, a privately-owned gas and oil producer supported by private equity. According to industry sources cited by Reuters, these talks have commenced after several months of negotiations in 2022, which previously broke down due to price disagreements. Eni has now agreed to a slightly increased takeover offer for Neptune, valuing the company between $5 billion and $6 billion, as per the same sources. This adjustment in the offer indicates significant progress in the negotiations, although there is no guarantee that an agreement will be reached. During the first quarter of 2023, Neptune reported a production of approximately 142,000 barrels of oil equivalent per day (boepd), with three-quarters of this production comprising gas. Neptune operates in various countries, including Norway, the UK, Indonesia, Algeria, the Netherlands, among others. The company is financially backed by China Investment Corporation, as well as funds advised by Carlyle Group and CVC Capital Partners. In March 2023, Bloomberg News disclosed that Neptune’s owners were working with advisors such as Goldman Sachs Group and Rothschild & Co. to explore different options for the company, including a potential sale. Earlier this year, Neptune, along with its partners Vår Energi, Sval Energi, and DNO, initiated production from the Fenja offshore oil and gas field in Norway. Situated 120km north of Kristiansund, at a water depth of 325m, the Fenja field is projected to have a gross production capacity of 35,000 boepd.

Climate justice campaigners have called on the Labour Party to ensure a fair transition to clean energy for displaced workers, while applauding their commitment to block new offshore oil and gas drilling if they gain control of the United Kingdom Parliament. Freya Aitchison, an oil and gas campaigner at Friends of the Earth Scotland, emphasized the need to leave fossil fuels in the ground to prevent further climate breakdown. While welcoming Labour’s opposition to new fossil fuel developments, Aitchison stressed the importance of accompanying this stance with plans for a just transition to renewable energy. An unnamed Labour Party source revealed on Sunday that they are against granting new licenses for oil and gas in the North Sea. The source pointed out that these licenses would not reduce bills, as acknowledged by the Conservative Party MP and chair of the U.K.’s independent Committee on Climate Change, John Gummer. The source highlighted the negative impact of such licenses on energy security and climate targets. They also stated that Labour would responsibly manage existing oil and gas wells over the coming decades as part of the transformation into a clean energy superpower. Labour Leader Keir Starmer is expected to formally announce the party’s commitment in Scotland next month during the unveiling of a net-zero energy policy blueprint. The Guardian reported that this blueprint will not only include a ban on new North Sea oil and gas licenses but also a restriction on borrowing for investments to green schemes.

On May 31, 2023, the Petroleum Safety Authority Norway (PSA) announced its approval for Equinor to utilize the Transocean Spitsbergen rig for production drilling in block 35/11 located in the North Sea. This permission specifically applies to the commencement of well 35/11-A-13H.
Block 35/11 falls within production license 090, which was initially granted on March 9, 1984, and has since been extended until December 31, 2040. Equinor acts as the license operator, holding a 45 percent interest, while its partners include Inpex Idemitsu Norge (15 percent), Neptune Energy Norge (15 percent), and Vår Energi (25 percent). The Transocean Spitsbergen rig, constructed in 2010 at Aker Stord, is a state-of-the-art dual-derrick semi-submersible rig of the sixth generation, designed to withstand harsh winter conditions. It boasts the capability to drill challenging highpressure and high-temperature formations, and is equipped with an automated drilling control system.

TotalEnergies has announced the renewal of its license for OML 130, an offshore block in Nigeria containing the Akpo and Egina fields. The block produced 282,000 boe/d in 2022, with a significant portion being gas sent to the Nigeria LNG plant. TotalEnergies plans to start production from the Akpo West project by the end of 2023. The license also includes the Preowei discovery, which will be developed through a tie-back to the FPSO Egina. TotalEnergies is pleased to continue its contribution to Nigeria’s oil and gas sector through the license renewal. The company aims to focus on low-cost and low-emission assets. TotalEnergies operates OML 130 with a 24% interest, alongside other partners. Nigeria has been working to attract new investments in the oil and gas sector, as seen through recent production sharing contracts and the introduction of the Nigerian National Petroleum Company.

China is ramping up efforts to construct a long-delayed Central Asian pipeline to import gas from Turkmenistan, while simultaneously facing Russia’s own Siberian pipeline proposal. The construction of the “Line D” project, which is part of China’s Belt & Road Initiative, has faced challenges due to complex price negotiations and technical difficulties associated with crossing three other Central Asian countries. However, Russia’s pursuit of the Power of Siberia 2 pipeline, aimed at compensating for reduced sales to Europe following the Ukraine crisis, presents an opportunity for China to advance its Central Asian project. Chinese officials view the Central Asian pipelines as strategically important for China’s energy security and geopolitical interests, prioritizing them over commercial considerations. While China may eventually pursue both pipeline projects to meet its long-term gas requirements, it is currently focusing on Turkmenistan due to its objectives of expanding trade, securing energy resources, and ensuring stability in the western Xinjiang region.

The market is divided over the possibility of an upcoming recession, leading investors to position themselves for potential rate cuts by the Federal Reserve. However, the Fed’s decision remains uncertain, and they are cautious due to their past credibility issues. Meanwhile, OPEC is dealing with falling oil prices and speculators going short. While they cite price stability and smoother functionality as reasons to cut, their main objective is to maintain a specific price level. OPEC’s surprise announcement of production cuts in April led to a temporary rally in oil prices, but they have since retreated and continue to decline. OPEC’s strategy works best in tight, demand-driven markets. However, the oil market is currently in a supply surplus, and eventual demand correction is expected. OPEC is reluctant to witness economic cycles and prefers to control prices, but this approach carries risks. The Chinese demand recovery, anticipated by investors, has not materialized as expected, and a slowdown is evident in all markets. It is crucial to allow prices to reach their natural equilibrium during an economic slowdown, even if it entails painful price declines. The introduction of quantitative easing by central banks has influenced investment landscapes, leading to inflated asset prices. When liquidity is withdrawn, all asset classes are affected. Attempts to control prices depend on the flexibility of the system, and the dynamics of the oil market in 2023 differ significantly from those of the previous year.

Saudi Oil Minister Prince Abdulaziz bin Salman issued a warning to market speculators, advising them to be cautious as they could face negative consequences. Speaking at the Qatar Economic Forum in Doha, he reiterated his stance against speculators who profit from predicting OPEC+ output decisions. The recent independent production cuts announced by some OPEC+ members temporarily boosted oil prices but were followed by a decline. Amid market volatility and ongoing concerns, the minister stressed the need for OPEC+ to remain proactive and pre-emptive. The possibility of further production cuts in June is being. questioned, despite the International Energy Agency predicting a supply squeeze in the near future. While market pessimism persists, the IEA anticipates tighter market balances in the second half of the year. However, the organization’s executive director highlighted the potential impact of a U.S. debt default on oil demand and prices. Analysts at UBS revised their Brent price forecasts due to higher-than-expected crude oil volumes and recession fears, expecting the market to experience undersupply in June. The oil minister also emphasized the risks of market uncertainty and the diminishing spare capacity in producing countries. He called for increased investment in both fossil fuels and renewable projects to address energy security concerns. Despite the challenges, Saudi Arabia remains committed to tackling volatility and maintaining stability in the oil market.

Cyprus and Israel are in the process of finalizing a deal to construct a pipeline that will transport natural gas from both countries to Cyprus, where it will be liquefied and exported to Europe and potentially other destinations, according to the Cypriot energy minister on Monday. Minister Giorgos Papanastasiou announced plans for an upcoming visit to Israel to negotiate and formalize the agreement. Once signed, the construction of the pipeline is expected to be completed within 18 months. Additionally, the establishment of a liquefaction plant on Cyprus will require approximately 2 ½ years after securing investors. Significant gas reserves have been discovered thus far, with Cyprus having identified five sizable gas deposits off its southern coastline. Meanwhile, Israel boasts 11 such fields, with the largest, named Leviathan, estimated to contain approximately 22 trillion cubic feet (623 billion cubic meters) of gas. Papanastasiou further expressed his intention to meet with energy companies, including French Total, Italy’s Eni, ExxonMobil, and Chevron, who hold licenses to explore for oil and gas within Cyprus’ exclusive economic zone. The objective of the meeting is to explore collaborative avenues that would facilitate the expedited delivery of their gas discoveries to the market.