Russia Cuts Interest Rates

The Central Bank of Russia cut its benchmark interest rate by 200 basis points to 18% on its July 2025 meeting, in line with median market expectations, and signaled that it will likely deliver another rate cut this year. 

The central bank noted that disinflationary pressures have developed at a strong magnitude than expected in the last policy decision in June, warranting looser financial conditions to attend to growth concerns. 

The latest data showed that annual inflation was at 9.4% in June.

The CBR stated that the impact of restrictive borrowing costs is becoming more apparent due to the appreciation of the ruble and slower household consumption. 

Additionally, signs of a softening labor market continued despite the persistent shrinkage of the labor force, largely due to Putin's military mobilization triggered a diaspora of working-aged men. 

source: Central Bank of Russia

United States Durable Goods Orders

Durable goods orders in the US declined 9.3% month-over-month to $311.84 billion in June 2025, reversing an upwardly revised 16.5% jump in May, and compared to forecasts of a bigger 10.8% slide. 

The biggest decline was seen in orders for transport equipment (-22.4%), mostly nondefense aircraft and parts (-51.8%) and capital goods (-22.2%), mainly nondefense (-24). 

Excluding transportation, new orders rose 0.2% and excluding defense, orders edged up 0.1%. 

Increases were seen in orders for fabricated metal products (0.2%), machinery (0.4%), primary metals (0.6%) and computers and electronics (0.6%). 

Meanwhile, orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, declined 0.7%, following an upwardly revised 2% advance in May and compared to forecasts of a 0.2% rise. 

source: U.S. Census Bureau

U.S. Sends Crude to OPEC’s Backyard

• Due to reduced domestic refinery demand and supply shortages in Nigeria, the U.S. exported more crude oil to Nigeria than it imported in February and March 2025.
• Nigeria's new 650,000 bpd Dangote refinery has turned to U.S. WTI crude for its superior gasoline blending qualities.
• WTI made up for 1/3 of its June feedstock.

Lower demand for crude oil from refiners at home gave a boost to U.S. exports of the commodity, turning it into a net exporter to OPEC member Nigeria in two of the seven months since the start of this year.

The news comes from the U.S. Energy Information Administration, which said this week that the United States exported more crude oil to Nigeria in February and March than it imported from it. The specific focus on Nigeria is because of the new Dangote refinery that went into operation recently. A much-needed processing facility in the West African nation, the refinery immediately suffered a shortage of local crude, prompting higher imports, notably from the United States.

As a result, U.S. exports to Nigeria rose to 111,000 barrels daily in February, going up further to 169,000 barrels daily a month later. Imports from Nigeria, meanwhile, fell to 54,000 barrels daily in February, ticking a bit higher the next month to 72,000 barrels daily. For context, the January average in oil imports from Nigeria stood at 133,000 barrels daily.

The reason for the temporarily lower demand for crude at home was the result of maintenance at a Phillips 66 refinery in New Jersey. The facility underwent maintenance in the first quarter of the year, returning to normal operations in April, which led to a return to normal oil trade trends between the United States and Nigeria.

Related: Iran Hit by Power Protests as Oil Exports Surge to 1.9 Million bpd

Exports of oil to Nigeria, however, are likely to remain strong, whatever the refinery maintenance situation. West Texas Intermediate has better gasoline blending capabilities because it yields greater volumes of reformate—a gasoline blending component produced through catalytic reforming. This is the technical advantage over other blends. But U.S. crude also has logistical advantages over other blends.

Earlier in the year, demand for U.S. crude in Asia shrank amid the trade war between President Trump and China, making volumes available to other buyers, especially ones that need the feedstock rather urgently due to failure to boost local supply. This is exactly what happened in Nigeria. Africa's top OPEC member has been struggling to materially boost domestic crude output, so the 650,000-barrels-per-day refinery built by Africa's richest man, Aliko Dangote, has been sourcing more WTI crude as it ramps up to capacity.

As of June, U.S. WTI purchases accounted for a third of the crude sourced by the Dangote refinery, which should at some point be able to cover 100% of Nigeria's demand for all refined petroleum products and will also have a surplus of each of the products for export. So far, Nigeria has been importing all the fuels it consumes despite being the largest crude oil producer in Africa.

Even so, Nigeria has been struggling to boost production, currently at some 1.4 million barrels daily, which is below the country's quota under the OPEC+ agreement from 2022. The government, however, is calling for a revision of these quotas, seeking a higher production rate, to the tune of 2 million barrels daily in two years, of which 1.7 million barrels daily of crude oil and 300,000 bpd of condensates. This is part of an ambition to boost the production capacity of Nigeria's oil industry to 2.4 million barrels daily over the medium term.

In the U.S., meanwhile, two refineries are set to shut down in California, one operated by Valero and another operated by Phillips 66, with a combined capacity of close to 300,000 barrels daily. This will likely have a permanent effect on domestic crude oil demand and possibly keep the availability of West Texas Intermediate for exports to Nigeria steady for the observable future.

By Irina Slav for Oilprice.com

Euro Area Interest Rate

The ECB kept interest rates unchanged in July, effectively marking the end of its current easing cycle after eight cuts over the past year that brought borrowing costs to their lowest levels since November 2022. 

The main refinancing rate remains at 2.15%, while the deposit facility rate holds at 2.0%. 

Policymakers struck a wait-and-see stance, as they evaluate the impact of lingering trade uncertainty and the potential fallout from proposed US tariffs on economic growth and inflation. 

Inflation hit the ECB's 2% target in June, adding to the case for a pause in policy adjustments. 

Speaking at the ECB press conference, President Lagarde said the central bank is "in a good place" but acknowledged the difficulty in assessing how tariffs will affect price outlooks, given the mix of both inflationary and disinflationary pressures. 

On the recent euro appreciation, Lagarde reiterated that the ECB does not target exchange rates directly but considers them when forecasting inflation. 

source: European Central Bank

United States Initial Jobless Claims

Initial jobless claims in the US fell by 4,000 from the previous week to 217,000 in the third week of July, well under market expectations that they would increase to 227,000. 

It was the sixth consecutive decline in initial claims to the lowest since April, extending the period of relative robustness in the US labor market following brief alarms earlier in the year. 

On the other hand, outstanding claims inched higher to 1,955,000 in the earlier week, marginally below market expectations but remaining at the second highest reading since November of 2021, reflecting a slowdown in the hiring momentum despite low unemployment. 

Initial claims filed by federal government employees, which have been under scrutiny following recent dismissals by the Department of Government Efficiency (DOGE), jumped by 193 to 789, the highest in four months. 

source: U.S. Department of Labor

United States New Home Sales

Sales of new single-family homes in the United States rose 0.6% in June 2025 to a seasonally adjusted annualized rate of 627,000 units, slightly up from May's seven-month low of 623,000 but still well below market expectations of 650,000. 

The data indicate continued pressure on the housing market, as high mortgage rates and economic uncertainty have led many buyers to delay purchasing decisions. 

Regionally, new home sales increased in the South (up 5.1% to 390,000) and the Midwest (up 6.3% to 85,000), while declining sharply in the Northeast (down 27.6% to 21,000) and the West (down 8.4% to 131,000). 

The number of unsold homes on the market rose to 511,000, the highest since October 2007, up from 505,000 in May. 

At the current sales pace, it would take 9.8 months to sell all the new houses available, slightly longer than May's 9.7 months. 

The median price for a new home fell 2.9% to $401,800 in June compared to a year ago. 

source: U.S. Census Bureau

United States Composite PMI

The S&P Global US Composite PMI rose to 54.6 in July 2025 from 52.9 in June, marking the fastest pace of growth in 2025 and the 30th consecutive month of expansion. 

The upturn was driven by strong services activity, which grew at the quickest rate since last December. 

Manufacturing output also increased, but at a more modest pace, showing a divergence in momentum between sectors. 

Employment continued to grow across the private sector. 

However, business confidence declined in both services and manufacturing amid concerns about federal spending cuts and tariffs. 

Rising wage costs and tariffs contributed to steeper input price inflation, which firms increasingly passed on to customers. 

As a result, output price inflation accelerated, ranking among the highest of the past three years. 

source: S&P Global

TotalEnergies Sees Tough Oil Market Outlook

TotalEnergies SE reported a big jump in net debt in the second quarter as the French energy major posted falling profit and pointed to an oil market that's being hurt by slower economic growth.

Net debt rose 29% from the previous quarter to $25.9 billion and nearly doubled from a year earlier as the company raised spending including on acquisitions and working capital increased. Its adjusted net income dropped to $3.58 billion, a 23% decline from a year earlier, missing the average analyst estimate of $3.67 billion.

"In an unstable geopolitical and macroeconomic environment (tariff war), oil markets remain volatile," Total said in its earnings statement Thursday. "The market is facing an abundant supply that is fueled by OPEC+'s decision to unwind some voluntary production cuts and weak demand that's linked to the slowdown in global economic growth."

Having lured investors with hefty payouts in recent boom years, Big Oil companies are now treading a fine line between investment, shareholder returns and mounting debt as oil prices come under pressure from global trade tensions and rising output by the Organization of the Petroleum Exporting Countries and its allies.

Total, the first oil major to report quarterly earnings, said it will maintain its target level for share buybacks of as much as $2 billion in the third quarter. However, it disclosed that it only repurchased $1.7 billion of shares in the three months through June, down $300 million from prior quarters.

The company's shares fell as much as 2.5% and were at 52.33 euros, a drop of 1.8% from the close, at 10:36 a.m. in Paris.

Net investments amounted to $11.6 billion in the first half notably due to $2.2 billion of net acquisitions of companies such as German renewable producer VSB. It will be in the range of $17 billion to $17.5 billion in 2025, unchanged from previous plans, thanks to the disposal program planned for the second half, TotalEnergies said.

Total said oil and gas production rose more than 3% in the first half of the year thanks to production startups in the US and Brazil, in line with the company's target for the full year. Production from its electricity division surged more than 20% from a year earlier.

The company confirmed the payment of the second interim dividend of 85 euro cents per share, an increase of about 7.6% from a year earlier.

Petrochemical production dropped in the second quarter due to planned maintenance on the Normandie facility in France and to weak demand in Europe. The the company has scheduled maintenance at Antwerp, Port Arthur and HTC in the third quarter.

Also in Total's Outlook:

Refining and petchems face structural overcapacity but have been helped by seasonal market

Hydrocarbon production to grow over 3% year-on-year in third quarter

Scheduled maintenance to reduce utilization to 80%–85% range.

https://www.rigzone.com/news/wire/totalenergies_sees_tough_oil_market_outlook-24-jul-2025-181256-article/?rss=true