JPMorgan Drops Oil Price Forecast, Cites Iran War Uncertainty

GE Vernova closed its most recent quarter with a $176 billion backlog, with management guiding to $200 billion in 2027, as surging AI power demand drives turbine capacity rationing. Q2 orders came in at $24.2 billion, up 88% organically, and the company signed 20 GW of gas contracts in the quarter alone, expecting at least 125 GW of gas equipment under contract by year-end 2026. CEO Scott Strazik told analysts the company expects to be "mostly sold out through 2030," with 2031 slots already filling, while annual turbine output scales from 20 GW in Q3 2026 to 24 GW in 2028 and 30 GW in 2030. Q2 free cash flow hit $5.1 billion, exceeding all of full-year 2025, prompting management to raise 2026 free cash flow guidance to $11.5 billion to $12.5 billion from a prior range of $6.5 billion to $7.5 billion, double the quarterly dividend to $0.50 per share, and lift buyback authorization to $10 billion. Electrification orders grew 66% organically at a book-to-bill of 1.7x, with data center orders crossing $5 billion year-to-date, more than double the entire 2025 total, though the Wind segment remains a drag with revenue down 10% in Q2 and roughly $400 million of full-year segment EBITDA losses expected.

Abu Dhabi's XRG is exploring the acquisition of a stake in the Shell-led LNG Canada export project and has been holding discussions with existing backers including PetroChina about buying some of their holdings, Bloomberg reported Tuesday. The potential purchase would fit with XRG's aim to become a top-five supplier of natural gas and petrochemicals, an ambition that has taken on greater urgency as the Middle East war has highlighted the importance of supply from outside the region. LNG Canada, the country's first large-scale liquefied natural gas export terminal, is a joint venture led by Shell's 40% holding, while Petronas owns 25%, PetroChina and Mitsubishi each hold 15%, and Kogas has 5%. The project's 14M metric tons per year capacity makes it one of the biggest operating plants in North America, supplying mostly South Korea, Japan, and China. The partners are considering a multibillion-dollar project to double capacity, with a decision expected later this year, according to Korea Gas and Malaysia's Petronas. XRG has been buying assets across the world and is looking for more, and parent Abu Dhabi National Oil Company has said it would be interested in exploring opportunities in oil and gas production facilities and LNG in Canada.

Saudi Aramco's 7 million b/d East-West Pipeline resumed pumping at a low rate after an 11-day shutdown, potentially allowing Yanbu exports to restart, but restoring the pre-attack flow of around 4 million b/d could take six to eight weeks. Even with the restart, unprecedented freight rates and relentlessly rising diesel prices still point toward structural tightness, with ICE Brent futures sliding toward the $100 per barrel mark. Daily earnings on a Gulf-to-China route soared to $1.2 million this week, and TotalEnergies fixed the Kuwait Prosperity tanker last week at an astonishing rate of $75 million, equivalent to $38 per barrel, with similar offers this week jumping closer to $100 million. Freight now makes up at least 25% of the total cost of crude delivered to Asia, up from 5-6% in 2025, pushing Chinese refiners importing Brazilian crude to switch from VLCCs to 1-million-barrel Suezmaxes. Separately, Apollo Global Management is evaluating a full or partial sale of Energos Infrastructure, which operates 13 floating LNG vessels, at a valuation of more than $3 billion, with ADNOC's investment arm reportedly keen to buy a stake of up to 50%.