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July 8 (UPI) — The U.S. Department of the Interior on Tuesday took steps to make it easier for oil and gas companies to “commingle” multiple U.S. onshore drilling lease applications.

The proposed updates to oil and gas regulations in DOI’s Bureau of Land Management would allow gas and oil company operators to combine, or commingle, multiple federal leases as a means to boost productivity and, the department added, to “better reflect modern industry practices.”

“This is about common sense and catching up with today’s technology,” said Interior Secretary Doug Burgum.

The move is a facet to U.S. President Donald Trump‘s recently passed tax and spending law to permit production via different leases, often under different ownership, and using the same well pad, which is the the cleared site where production facilities operate.

“Commingling” is an industry term to define the intentional or unintentional blending of fuels either to mix similar products together for transport and storage, or to create a newer product with specific characteristics.

Currently, the bureau restricts commingling to leases only with identical mineral ownership, royalty rates and revenue distribution.

The proposed policy switch has a July 15 effective date, barring no unforeseen issues, and overwhelmingly favors corporate interests.

Burgum says the current rules were written “for a different era.”

The administration said the proposed commingling of applications would reduce environmental effects, lower operating costs and increase corporate efficiency.

“These updates will help us manage public resources more efficiently, support responsible energy production, and make sure taxpayers and tribes get every dollar they’re owed,” Burgum continued in a statement.

The department argues it will unlock “energy potential that is currently tied up in regulatory red tape,” and further claimed it could result in nearly $2 billion in annual savings for the oil and gad industry.

Federal regulators for decades treated separate reservoirs with slightly drilling pressures as different reservoirs. The redundancy cost companies about $1.8 billion in avoidable annual costs, which was the same figure cited by DOI as corporate savings.

DOI officials went on to state how those savings could give corporate entities the ability to reinvest in new energy production which, officials added, would help “drive domestic energy development while reducing the need” for a company to invest in extra equipment.

The changes in federal rules could result in a 10% spike in production and over 100,000 extra barrels per day added to American output, Energy Department officials said.

On Tuesday, the administration said the Bureau of Land Management plans to “move quickly” to update the proposed federal regulations after a period of public comment and before the July 15 start date of the new policy.

By Tina Teng

Published on
23/05/2025 – 8:14 GMT+2

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Crude oil prices fell for a third consecutive trading day on Thursday ahead of the US-Iran nuclear talks. Traders are growing concerned about the possible return of oil supply from Iran, which holds around one-third of the world’s oil reserves.

Adding to the pressure, a Bloomberg report stated that the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) is considering a third consecutive production hike in July, compounding fears of an oversupplied market.

Oil prices continued to decline during Friday’s Asian session. As of 4:40 am CEST, Brent futures were down 0.59% to $64.06 per barrel, while West Texas Intermediate (WTI) futures fell 0.6% to $60.83 per barrel—both touching their lowest levels in over a week.

Potential oversupply overshadows geopolitical tensions

Crude prices have experienced notable volatility in recent weeks as market participants weigh rising geopolitical tensions against mounting supply from major oil-producing nations. Broader macroeconomic factors—such as easing US-China trade tensions and renewed selling in US Treasuries—have also been influencing oil market movements.

Earlier in the week, prices briefly spiked following a CNN report that Israel was preparing to launch strikes against Iran’s nuclear facilities, citing intelligence from US sources. However, the rally proved short-lived, with analysts suggesting the warning may have been a strategic move by the US to exert pressure on Iran ahead of the nuclear negotiations.

The geopolitical boost was quickly overshadowed on Wednesday by data showing a surge in US crude inventories. According to the Energy Information Administration (EIA), US oil stockpiles rose to 443.2 million barrels in the week ending 16 May—the highest level since July 2024. The report also indicated that net US crude imports had increased for a third consecutive week, while domestic demand remained weaker than expected.

OPEC+ may accelerate production hike

News about OPEC+’s potential acceleration in production hike sent the oil price down further on Thursday. The oil production cartel is reportedly considering hiking crude output by 411,000 barrels per day (bpd) in July. The decision is yet to be finalised on 1 June when the group holds the next meeting.

The group, which accounts for around 40% of global oil supply, has jointly reduced production by approximately 2.2 million bpd in 2023. The quicker-than-expected phased rollback began with a 135,000 bpd increase in April, tripling to 411,000 bpd in May and June. The acceleration is seen as a punitive measure against members which failed to comply with agreed production quotas, with Kazakhstan and Iraq identified as recent overproducers.

Crude prices have consistently fallen following OPEC+ announcements of larger-than-expected production increases in both April and May. However, the potential July decision may already be priced in by markets—unless the group surprises traders with an even more aggressive supply boost.

Demand outlook remains weak

The demand outlook remains fragile amid ongoing concerns over slowing global growth, particularly driven by the US tariffs. Crude prices had previously dropped to a four-year low on 9 April and again on 5 May. The oil market rebounded following the US and China’s trade talks earlier this month, when the world’s two largest economies reached an agreement to pause high tariffs on each other for 90 days.

While near-term pressure remains supply-driven, there is cautious optimism that a sustained recovery in market sentiment, driven by further progress in US tariff negotiations, could support a rebound in oil demand.

“While the immediate pressure comes from the supply side, I believe that in the longer term, further progress on US tariff negotiations with key partners could revive demand and offer more meaningful support for oil,” Dilin Wu, a research strategist at Pepperstone Australia, said.

Despite slowdown, data points to reliance of Chinese economy in the face of Donald Trump’s tariffs.

China’s industrial output and retail sales growth have slowed amid trade tensions with the United States.

Factory output grew 6.1 percent year-on-year in April, down from a 7.7 percent rise in March, data released by China’s National Bureau of Statistics showed on Monday.

While down compared with the previous month, the figure beat analysts’ expectations.

Analysts polled by the Reuters and Bloomberg news agencies had respectively forecast growth of 5.5 percent and 5.7 percent.

Retail sales grew 5.1 percent year-on-year, slower than the 5.9 percent growth recorded in March and below analysts’ forecasts.

Fixed-asset investment, which includes property and infrastructure investment, rose 4 percent.

Unemployment fell slightly, from 5.2 percent to 5.1 percent.

The latest data is likely to bolster hopes of China’s economy remaining resilient in the face of US President Donald Trump’s tariffs, after gross domestic product expanded a better-than-expected 5.4 percent in the January-March period.

The National Bureau of Statistics said the economy maintained “new and positive development momentum” due to Beijing’s economic policies, despite the “increasing impact of external shocks”.

“However, we should be aware that there are still many unstable and uncertain factors in external environment, and the foundation for sustained economic recovery needs to be further consolidated,” the statistics agency said in a statement.

The economic figures are the first to be released since Washington and Beijing last week agreed to dramatically reduce tariffs on each other’s goods for 90 days.

Under the deal reached in Geneva, the US lowered its tariff on Chinese goods from 145 percent to 30 percent, while China slashed its rate from 125 percent to 10 percent.

“The risk is that tariffs remain in place for a long time, and eventually, we see production offshored,” Lynn Song, chief economist for Greater China at ING, said in a note on Monday.

“But amid tariff unpredictability, not just for China but across the world, few companies will be rushing to commit resources to set up offshore manufacturing facilities. This could mean that a decent portion of China’s manufacturing and exports will be less impacted than originally feared.”