FINWIRES · TerminalLIVE
FINWIRES

Energy Markets Face Libya Supply Risks, Texas Gas Revision and New Tariffs, RBC Says

By

Fresh security risks in Libya threaten oil flows, while weaker forecasts for Texas gas demand growth and new clean-energy tariffs add further uncertainty to energy markets, RBC Capital Markets said in a note on Thursday.

Washington has pursued a reunification deal since April between the internationally recognized Government of National Unity in Tripoli and the Government of National Stability in Benghazi, which is backed by General Khalifa Haftar's Libyan National Army.

Energy risks have increased as groups aligned with the Tripoli government clash, with recent attacks in Zawiya targeting fuel storage, Libya's largest refinery, a desalination plant and a power substation.

The National Oil Corporation warned that additional attacks could force the 120,000 b/d Zawiya refinery to declare force majeure, adding to refined-product risks as damage-related outages expand across Russia and the Middle East.

RBC said its middle-high oil scenarios assume Strait transit remains 50% below pre-war levels or lower, while deferred demand, inventory rebuilding, geopolitical premiums, insurance costs and infrastructure damage could provide further price support.

RBC said near-term headlines could provide some price relief, but China's return from "eco mode" remains a key wildcard, with no clear evidence of a fundamental shift in the near term.

In the power markets, the Energy Information Administration cut its 2027 electricity-load growth forecast for the Electric Reliability Council of Texas to 6% from 14%.

The agency also lowered its 2027 outlook for gas-fired generation growth to 4% from 20% following its review of data-center demand.

RBC said the review excludes data centers that develop their own power supplies. Amazon plans a 7.65 gigawatt behind-the-meter gas plant in Texas, while RBC estimates 38 GW of such gas capacity is under development in the state.

Starting in early December, new clean-energy tariffs will set minimum import prices of $21/kg for polysilicon, $100/kg for ingots and wafers, $0.38/watt for solar modules and $0.22/watt for cells.

A 15% tariff on downstream imports will also stack on top of country-specific anti-dumping and countervailing duties. RBC said the measures support domestic solar manufacturing while targeting China's efforts to circumvent duties through countries including India, Indonesia and Laos.

Related Articles

Oil & Energy

US Oil Update: Crude Little Changed as Markets Weigh US-Iran Talks, Weak Demand

Crude futures were little changed in after-hours trading on Wednesday as markets weighed downward revisions to global demand forecasts against persistent supply risks amid the US-Iran talks impasse and ongoing maritime security risks.Front-month West Texas Intermediate crude futures slipped by 0.75% to $82.58 per barrel, while Brent futures eased by 0.48% to $88.48/bbl.Gelber & Associates strategists said that a reported build in US crude inventories is limiting the upside, although declines in gasoline and distillate stocks point to firmer demand for refined products.US commercial crude oil inventories increased by 17.4 million barrels to 424.4 mmbbls in the week ended Aug. 7, the Energy Information Administration said in its weekly report on Wednesday.Crude inventories were about 2% below the five-year average for this time of year, the EIA said. The larger-than-expected build is above Investing.com's estimate of a 1.7-mmbbl draw for the week.RBC Capital Markets strategists said crude prices have been whipsawed by both sentiment around the Iran conflict and the reality on the water, noting that the headline-driven uncertainty has shifted market participation and price outcome.On the supply front, the Organization of the Petroleum Exporting Countries on Wednesday slashed its global oil demand growth forecasts for the fourth straight month for 2026, projecting demand to grow by 600,000 barrels per day over the year.The reduction is 200,000 b/d less than its July forecast of 800,000 b/d, already down from 1 million b/d in June, 1.2 mmbbl/d in May, and 1.4 mmbbl/d in April.On Wednesday, the International Energy Agency also forecasted global demand to contract in 2026 by 1.6 million b/d, steeper than the about 1 million b/d drop seen last month.The IEA said that global demand outlook is forecast to decline 510,000 b/d more than the agency's July estimate as the ongoing closure of the Strait of Hormuz and elevated fuel prices continue to weigh on oil consumption.Meanwhile, President Trump said on Wednesday the US has "total control" of the Hormuz and expects to maintain control as Pakistan, the mediator between the two countries, reportedly said the deadline for a memorandum of understanding between Washington and Tehran could be extended."The USA has total control over the Strait of Hormuz. I think we will keep it! Our naval blockade is being called, by everyone, 'a wall of steel', and there is nothing Iran can do about it," Trump said in a Truth Social post.Tensions around the Middle East energy chokepoints remain elevated on Aug. 11, though the number of confirmed crossings increased, with Hormuz recording 14 crossings, up 16.7% day on day, while Bab el-Mandeb traffic rose 14.3% to 40 crossings.

Oil & Energy

Hormuz, Bab el-Mandeb Traffic Edge Up as Security Risks Keep Shipping on Edge

Commercial vessel traffic through the Strait of Hormuz and Bab el-Mandeb increased slightly on Tuesday, but a rise in vessel movements has done little to signal a return to normal shipping conditions as security risks persist.The latest data from MarineTraffic show that 14 vessels crossed Hormuz on Tuesday, up 16.7% from 12 on Monday.The latest daily set included 2 sanctioned vessels and 3 shadow fleet vessels, MarineTraffic said.A total of 11 vessels of the 14 on Tuesday used the Iranian unilateral transit scheme and none used the traditional traffic separation scheme. The remaining three were "route undetermined."Traffic via Bab el-Mandeb rose to 40 crossings on Tuesday, up 14.3% from 35 on Monday, the maritime analytics firm said. This included vessels associated with dark, sanctioned and shadow fleets.The increase comes despite continued warnings over attacks and the risks associated with transiting the southern Red Sea.The higher traffic volumes suggest that commercial shipping has not stopped entirely, but Kpler said the two strategic waterways remained "active but fragile," with routing constraints, security incidents and diplomatic tensions continuing to affect voyage decisions.The Hormuz, through which 20% of the world's oil and gas trade traditionally passes, remains particularly constrained.Iran's Persian Gulf Strait Authority has rejected claims by US officials that the Strait is no longer blocked, saying the strategic waterway will not be reopened until Tehran's conditions are accepted.The US military has also continued enforcing its blockade of Iranian ports. The US Central Command said that US forces had redirected 59 commercial vessels, disabled three and boarded two as of Aug. 12 to ensure compliance with the blockade.On Tuesday, the UKMTO said activity by Iran's Islamic Revolutionary Guard Corps, including hailing, drone overflights and targeted surveillance of merchant shipping, continued despite a lack of confirmed reports of attacks in the strait itself.The maritime security agency reported two new attacks on ships in the Gulf of Oman and the Red Sea, highlighting the widening threat to maritime trade.Commercial traffic through the Hormuz remained suppressed, with independent tracking data showing single-digit numbers of tankers moving in each direction.UKMTO also warned of the continued risk from drifting or uncharted mines in and around the traffic separation scheme.Meanwhile, the International Maritime Organization's daily Strait of Hormuz incident tracker showed the total number of confirmed maritime security incidents in the region to be 65 as of Tuesday.The IMO tracker provides a daily log of verified strikes on ships attempting to transit the Strait of Hormuz since the conflict began, with the earliest incident recorded on March 1.

Oil & Energy

Market Chatter: HPCL, MRPL Seek Up to 6 Million Barrels of Crude via Tenders

India's state-backed refiners Hindustan Petroleum and Mangalore Refinery and Petrochemicals are seeking up to a combined six million barrels of crude through spot tenders, Reuters reported on Wednesday, citing a tender document.HPCL is looking to import up to four million barrels for delivery in September and October, while MRPL is seeking as many as two million barrels for delivery between Oct. 10 and 20, the report said.MRPL has instructed suppliers to avoid routing shipments through the Red Sea and the Strait of Hormuz. Traffic through the energy chokepoints remained subdued this week amid ongoing Middle East conflict.Hindustan Petroleum and Mangalore Refinery did not immediately respond to' request for comment.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)