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Feb 10 - By Liz Hampton

U.S. Energy Markets Editor

Hello Power Up readers! It's the Monday after the Super Bowl and the Chiefs’ winning streak has at last been broken. Congrats to all the Eagles fans out there. While that game might have been a bit of a snoozer, there's no slowing down in the energy world. U.S. President Donald Trump punted on tariffs that would have roiled the oil markets last week, but now plans to announce a 25% levy on all steel and aluminum imports to the United States. More on that below. Meanwhile, global benchmark Brent crude futures are trading at $75.49 a barrel, up 85 cents, while U.S. West Texas Intermediate $(WTI)$ futures are at $71.88 a barrel, up 88 cents. Henry Hub natural gas futures are up about 3.8% to $3.439 per million British thermal units.

Threat of a trade war still lingers in the market

Trump's tariffs are continuing to make waves and dominate headlines, even after he delayed those on Mexican and Canadian imports by a month last week.

The latest tariff announcement, expected today, will impose 25% on imports of steel and aluminum into the United States. That is on top of already existing metals duties.

Trump also said he is planning to announce reciprocal tariffs on Tuesday or Wednesday, which would take effect nearly immediately, matching rates levied by all other countries.

While the duties on Canadian and Mexican energy products have been delayed, Trump has followed through with tariffs on China. This prompted the world’s top energy consumer to respond with its own 10% levy on U.S. crude and a 15% duty on U.S. liquefied natural gas $(LNG)$ and coal.

In China, oil and gas traders are expected to seek waivers from Beijing over retaliatory tariffs.

Still, such duties could hit U.S. crude exports, which were already showing signs of plateauing, Arathy Somasekhar reports. China consumes about 166,000 barrels of U.S. crude every day, about 5% of its total exports.

Meanwhile, energy companies and oil market participants are preparing for the possibility that Trump does in fact impose tariffs on Canadian and Mexican energy products in a month.

Canadian pipeline operator Trans Mountain last week said it could expand its massive pipeline system by another 200,000 to 300,000 barrels per day (bpd).

The system currently has capacity to carry 890,000 bpd of crude from Alberta to Canada's Pacific Coast. It is expected to fill quickly if the U.S. actually slaps tariffs on Canadian crude as market participants scramble for new outlets outside of the U.S. It currently accounts for roughly 9% of Canada's exports.

ESSENTIAL READING

Venezuela's state oil company PDVSA has resumed regular imports of light crude as its output of medium and light grades is dwindling, Marianna Parraga reports. The country increased exports in January to 867,000 bpd of crude and fuel, including nearly 300,000 bpd to the United States.

U.S. oil and gas firms added rigs for a second week in a row last week, energy services firm Baker Hughes said on Friday. The rig count rose by four to 586, roughly 6% under last year's levels.

Malaysian state energy company Petronas will cut its workforce in a bid to ensure its long-term survival following increasing challenges in the global operating environment. The company, which has some 50,000 employees, did not say how many would be affected.

U.S. oil major Chevron is accelerating its Kazakh oilfield ramp-up, sources told Reuters on Friday, boosting output to around 1% of global crude supply. In January the company said it had started a $48 billion expansion of Tengiz, one of the deepest and most complex fields due to its high sulfur content and harsh weather conditions.

Ukrainian President Volodymyr Zelenskiy has offered a mineral partnership to the United States, where the country would supply America with rare earths and other minerals in return for financially supporting its war effort against Russia.

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(Editing by Marguerita Choy)

((liz.hampton@thomsonreuters.com))