- Oil is trading lower after a sixth consecutive weekly decline last week
- The US Dollar index is trading higher this morning, which can pressure crude prices
- Attacks on shipping continue in the Red Sea (BBG)
- Over the weekend, Iranian-backed Houthi rebels targeted two ships, leading a US naval vessel to respond
- This is the latest in a series of attacks by Yemeni rebels against commercial vessels in the Red Sea, which the US military has described as “a direct threat to international commerce and maritime security”
- Venezuela holds a referendum to annex a large part of Guyana (BBG)
- On Sunday, Venezuelans voted in a referendum on the country’s claim over the Essequibo region of Guyana, which is about two-thirds of the country and includes the vast majority of Guyana’s offshore oil reserves and
- Guyana has some of the largest crude reserves in South America, which has recently fueled tensions in the century-old dispute with Venezuela
- Brazil said it would support Guyana and deploy additional troops to the northern border of the two countries
- Hostile action by Venezuela could impact recent talks with the US to lift or reduce sanctions on the country’s oil industry
- Panama Canal jam sends ships on longer routes (BBG)
- Low water levels are expected to continue to plague the vital shipping route, with only 18 vessels per day projected to transit the canal in February compared to an average of 36-38
- Transit time from the US Gulf Coast to Asia typically takes 20 days through the Panama Canal, while going through the Suez Canal takes 30 days, and the Cape of Good Hope takes 32 days
- This has led to higher shipping costs, which could continue well into 2024