Crude oil futures fell more than 4% on Tuesday, as a looming global oil surplus next year overshadowed the risk of a supply disruption from the conflict between Israel and Iran.

Oil prices spiked earlier this month after Iran hit Israel with a ballistic missile attack, raising fears that Israel would respond by targeting the Islamic Republic’s oil facilities.

The International Energy Agency said Tuesday that its members are prepared to take action if there is a supply disruption in the Middle East.

“For now, supply keeps flowing, and in the absence of a major disruption, the market is faced with a sizeable surplus in the new year,” the IEA said in its monthly report.

Here are today’s energy prices around 5:30 am ET:

• West Texas Intermediate November contract: $70.28 per barrel, down $3.55, or 4.9%. Year to date, U.S. crude oil has fallen 2%.
• Brent December contract: $73.81 per barrel, down $3.65, or 4.8%. Year to date, the global benchmark has declined about 4%.
• RBOB Gasoline November contract:  $2.0197 per gallon, down 4.2%. Year to date, gasoline has pulled back nearly 4%.
• Natural Gas November contract: $2.465 per thousand cubic feet, down 1.16%. Year to date, gas has fallen nearly 2%.

World oil demand is expected to grow by just under 900,000 barrels per day in 2024 and 1 million bpd in 2025, a significant slowdown compared to growth of 2 million bpd in post-pandemic period, according to the IEA.

Chinese oil demand is particularly weak, with consumption dropping by 500,000 bpd in August, the fourth monthly decline in a row, according to the agency. Meanwhile, crude production in the Americas, led by the U.S., is poised to grow by 1.5 million bpd this year and next, the IEA said.

OPEC has cut its oil 2024 forecast for the third consecutive month in a row.

With shares of his nascent social media business in the midst of a sharp rebound and with just three weeks until the presidential election, Donald Trump is bringing his latest proposed money-making endeavor to market, this time in crypto.

On Tuesday, the former president and current Republican nominee aims to launch WLFI, the token accompanying his new crypto project called World Liberty Financial. Over the weekend, Trump pumped the sale in a post on X, telling his followers that it’s a “chance to help shape the future of finance.”

Prospective investors can be forgiven for having little idea about what they’re being asked to support.

People involved with WLF have described it as a sort of crypto bank, where customers will be encouraged to borrow, lend and invest in crypto. No official white paper or formal business plan has been released to the public, and about all that’s been disclosed is that investing in the project will give users voting rights over the yet-to-be-launched WLF platform.

In a roadmap given to prospective investors that was first viewed by The Block, the WLF proposal says the coin is looking to raise $300 million at a $1.5 billion valuation in its initial sale. CNBC reached out to WLF for comment but didn’t hear back.

World Liberty Financial is separate and apart from Trump Media & Technology Group, the parent company of social media platform Truth Social. Trump Media, known by ticker symbol DJT, started trading in March, after going public through a special purpose acquisition company (SPAC). It’s been a rocky road for the stock, which peaked at close to $80 in late March, before falling all the way down to $12.15 last month.

But since bottoming on Sept. 23, DJT shares are up close to 150% at $29.95, giving the company a market cap of $6 billion. That’s on revenue of less than $1 million a quarter and after the company lost more than $16 million in the latest period.

While DJT shares can be purchased by anyone, the digital coin WLFI will be a Regulation D token offering, following a provision that makes it possible to raise capital without first registering a security with the SEC. Certain conditions must be met, such as limiting the size of the sale and restricting it to accredited investors, defined in part as having a net worth of over $1 million.

Trump owns about 57% of DJT’s outstanding shares, but his potential control over World Liberty Financial is more opaque. WLF’s website, which is currently a landing page to register for know-your-customer verification to buy the coin, includes some of the fine print that indicates the financial incentive for the founders.

Co-founder Zachary Folkman, who previously had a company called Date Hotter Girls and reportedly helped develop crypto project Dough Finance, has said that 20% of WLF’s tokens would be allotted to the founding team, which includes the Trump family.

And there appears to be another way they can make money.

“DT Marks DEFI, LLC and its affiliates including Donald J. Trump and his family members has or may receive tokens from World Liberty Financial, and will be entitled to receive significant fees for services provided to World Liberty Financial, which amount cannot yet be determined,” the website says.

On Monday, less than 24 hours before the planned token launch, the WLF team convened a conversation on X Spaces to share details of the sale. About 12,000 people tuned in to listen to the more than hourlong chat about the overarching goals of the project.

Folkman reiterated what he said in a prior Spaces event, telling attendees that WLFI is a governance token that allows holders to vote on decisions regarding the protocol, including initiatives like promotional partnerships. He said token ownership “isn’t equity” and “doesn’t represent economic right.”

Folkman said the token sale will exclusively take place on World Liberty’s website, and that only those who had been whitelisted after signing up will be able to participate. He said “well over 100,000 people” are on the whitelist and that it’s not too late to register. Folkman added that WLF would publish the “long-awaited” roadmap for the project on Tuesday, in tandem with the token sale.

Last week, WLF began the process of getting its crypto bank approved by the decentralized finance (DeFi) ecosystem known as Aave.

Aave is open source and, in DeFi, is one of the longest-running and most-trusted crypto lending platforms.

“The protocol itself is permissionless, so I’m kind of less opinionated about integrations, because that’s the whole idea of decentralized finance,” Aave founder Stani Kulechov told CNBC in an interview at the Permissionless Conference in Salt Lake City, Utah.

Kulechov joined Monday’s X event and said he’s “excited that WLF is using and relying on” Aave.

‘”That’s a strong signal that what we build is fairly useful, so we’re super excited,” he said.

In a 400-word post to Aave’s governance forum, the WLF team presented a brief outline of its objectives, which include promoting “DeFi to a wider audience through its marketing efforts,” and introducing “a new class of users to over-collateralized borrowing and lending.” The proposal is currently at the preliminary stage of consideration known as “Temp Check,” and Aave’s users are able to comment on the plan.

In the comments section, a number of users raised concern over the project’s deep ties to the Trump family.

“I believe this proposal poses significant risk to the Aave protocol for little gain,” according to one comment that’s since been deleted. The commenter then questioned the rationale of having “the largest and most trusted protocol in DeFi” working with a group led “by people of questionable backgrounds … including several convicted criminals.”

Folkman helped start WLF with long-time business partner Chase Herro. CoinDesk reported that the pair previously worked on Dough Finance, which was also built on top of Aave and suffered a $2 million hack in July. Herro also launched another crypto trading business a decade ago called Pacer Capital, which appears to now be defunct.

For World Liberty to proceed, it must pass multiple rounds of consideration and approval, each decided by a vote among existing AAVE token holders.

At this stage in the process, the token sale is akin to an IOU. Those who buy in now have a claim to the token if and when the platform is approved and launched.

WATCH: Crypto warms to Kamala Harris

Google said Monday that it will purchase power from small modular reactor developer Kairos Power, as tech companies increasingly turn to nuclear power as a way to fulfill the growing energy demands from data centers.

The tech giant said it will purchase power from a fleet of SMRs made by Kairos Power. Google said purchasing from multiple SMRs sends an “important demand signal to the market,” while at the same time making a long-term investment to accelerate commercialization.

“We believe that nuclear energy has a critical role to play in supporting our clean growth and helping to deliver on the progress of AI,” Michael Terrell, senior director for energy and climate at Google, said on a call with reporters. “The grid needs these kinds of clean, reliable sources of energy that can support the build out of these technologies. … We feel like nuclear can play an important role in helping to meet our demand, and helping meet our demand cleanly, in a way that’s more around the clock.”

The company did not disclose the financial terms of the deal.

There are only three SMRs that are operating in the world, and none in the U.S. The hope is that SMRs are a more cost-effective way to scale up nuclear power. In the past, large, commercial-scale nuclear reactor projects have run over budget and behind schedule, and many hope SMRs won’t suffer that same fate. But it is uncharted territory to some extent.

Kairos Power, which is backed by the Department of Energy, was founded in 2016. In July, the company began construction on its Hermes Low-Power Demonstration Reactor in Oak Ridge, Tennessee. Rather than use water as the reactor coolant – as is used in traditional nuclear reactors – Kairos Power uses molten fluoride salt. 

Google said the first reactor will be online by 2030, with more reactors going live through 2035. In total, 500 megawatts will be added to the grid. That’s much smaller than commercial reactors — Unit 4 at Plant Vogtle, which came online this year, is 1.1 gigawatts, for example — but there’s a lot of momentum behind SMRs. Advocates point to lower costs, faster completion times, as well as location flexibility as reasons.

Monday’s announcement is another example of the growing partnership between tech companies and nuclear power. Data centers need 24/7 reliable power, and right now nuclear is the only source of emissions-free baseload power. Many hyperscalers have ambitious emissions-reduction targets, which is why they’re turning to nuclear power.

Constellation Energy is restarting Three Mile Island to power Microsoft data centers, while Amazon bought a data center from Talen Energy that’s powered by the Susquehanna nuclear power plant. Bill Gates, Sam Altman and Jeff Bezos have all backed nuclear companies.

Earlier this year, Google said its emissions have grown nearly 50% relative to 2019 thanks in part to an increase in data center power consumption. 

“It is an incredibly promising bet, and one that, you know, if we can get these projects to scale and then scale globally, will deliver enormous benefits to communities and power grids around the world,” Terrell added.

Recent data shows the discount on Russian oil narrowing and exports increasing despite the G-7 price cap on Russian petroleum exports and U.S. sanctions.

According to Clearview Energy Partners, Russian crude prices over the last four weeks have averaged about six cents below the Brent crude price. That is far off the trading discount when the cap was first put in place. When the cap was fully phased in, in February 2023, Russian crude was selling at a 30% discount. A year ago, the discount was about 16%.

Ukraine allies, including the U.S., have banned the import of Russian crude, while a price cap imposed on Russian oil by the G7 countries, the European Union and Australia bans the use of Western maritime services such as insurance, flagging and transportation when tankers carry Russian oil priced at or above $60 a barrel to nations where a ban is not enforced.

In a recent report to clients, Clearview Energy Partners characterized the G-7 price cap on Russian petroleum exports to third countries as “increasingly loose.”

Kevin Book, managing director of research at Clearview Energy Partners, told CNBC that despite the G-7’s June and September calls for improving the price cap, and recent guidance urging parties to Russian petroleum transactions to better scrutinize cargoes, “a U.S. pinch on Russian petroleum seems unlikely until after the election.”

“A cap enforcement crackdown runs the risk of driving up crude prices,” he said. “Plus, using ‘secondary’ sanctions to enforce the cap could push reputable insurers out of the Russian crude game entirely, leaving the market to potentially insolvent stand-ins.”

Book explained that part of the narrowing of the discount is a result of Russian oil finding additional buyers, including India and China.

Record volumes of sanctioned Russian oil were carried by the “dark fleet” and known sanctioned tankers without known insurance over September, according to a recent report from Lloyd’s List.

The Lloyd’s List Intelligence unit analysis of data from energy cargo tracking firm Vortexa revealed that 69% of all crude shipped in September was carried on dark fleet tankers and 18% was carried on tankers owned by Russian government-controlled Sovcomflot. It is the most volume moved since tracking of the monthly dark fleet data began in mid-2022 (measured by deadweight capacity of vessels.) In May, 54% was recorded, the previous high.

Chinese and Indian oil traders, refiners, and port authorities were the drivers of this growth.

Lloyd’s List determines if a tanker is part of the dark fleet based on factors including if the ship is 15 years or older, is anonymously owned or has a corporate structure designed to conceal ownership, is handling sanctioned oil trade, and is using deceptive shipping practices. Its analysis showed a flurry of flag-hopping, where a vessel changes its country registration, as well as ownership and management changes amongst the vessels in the dark fleet to avoid detection.

The dark fleet data does not include Russia’s Sovcomflot or Iran’s National Iranian Tanker Co.

Its data revealed that 5% of all Russian oil in September was transported by 11 tankers, with nine of those vessels sanctioned by the UK or EU between July and September and owned by the Russian government-controlled tanker company Sovcomflot. The remaining vessels were sanctioned by the U.S. Office of Foreign Assets Control for breaching sanctions on Syrian and Iranian oil. Those vessels are the Eternal Peace and Nebulax.

Some of the Sovcomflot tankers that Lloyd’s List identified in its report were sanctioned by the UK or EU between July and September. Some tankers changed vessel names, reflagged the vessel’s origin to Barbados, or redomiciled registered ownership to Seychelles and changed their ship management to a newly incorporated UAE-based ship manager, Avebury Shipmanagement.

Greece-owned tankers have shipped 23% of oil from Russia in September, consistently over the last three months, according to Lloyd’s List. The majority of the UK- and EU-sanctioned tankers have already discharged their oil in China.

Andy Lipow, president of Lipow Oil Associates, said despite the price cap, some ship owners have decided that it was extremely profitable to have their vessels become part of the dark fleet and risk United States and EU sanctions.

“After all, Russian oil continues to be purchased by Chinese and Indian refiners with little repercussions from the U.S. or EU,” said Lipow.

A Treasury spokesperson told CNBC, “Two years since the price cap was implemented, it is unsurprising that Putin is still sinking money into building and maintaining a shadow fleet to escape the Coalition’s sanctions: that evasion costs the Kremlin, and diverts money that would otherwise be going to the battlefield. The Price Cap Coalition continues to engage with industry to ensure compliance with the price cap and to increase Putin’s costs of going outside it.”

The number of uninsured vessels carrying sanctioned oil also increased, according to Lloyd’s List, with some 201 of the 310 tankers tracked not having insurance with the 12 clubs that form the International Group of P&I Clubs. That represented 68% of the vessels when measured by deadweight, and the lowest number of tankers tracked with IG club insurance, surpassing 67% uninsured recorded in July and August.

Lipow said the oil market is pricing in a greater probability of a war between Iran and Israel that could impact supply.

“The biggest risk to the oil market is the closure of the Straits of Hormuz, and while unlikely, if it were to happen, oil prices would rise $30 per barrel,” he said. Despite the hostilities, oil prices remain under pressure, he said, as increased production from the U.S., Canada and Guyana adds to the supply picture while OPEC+ delays the restoration of its production cuts.

The increased use of dark fleet vessels comes with greater maritime safety and environmental risks.

Lloyd’s List warned in a recent note that shipping safety has become a “casualty of economic sanctions” with attempts to enhance sanctions policy leading to greater ranks of tankers determined to evade it.

Insurance giant Allianz said in May that dark fleet tankers had been linked to more than 50 accidents.

Lipow told CNBC if these vessels were to be involved in an accident that resulted in an oil spill, the owners — assuming they could be identified and found — would simply walk away, leaving the mess and subsequently the cleanup for someone else to do.

Crude oil futures fell more than 2% on Monday after a press briefing by China’s finance minister disappointed the market.

Traders have been banking on more robust stimulus in China to boost the world’s second-largest economy. Soft demand in the world’s largest crude importer has weighed on the market for months.

“China’s monetary stimulus measures failed to stimulate and the weekend’s pledge from the finance ministry to borrow more was long on cliches and phrases but short on reassuring and convincing details,” Tamas Varga, analyst at oil broker PVM, told clients in a note.

Here are Monday’s energy prices:

• West Texas Intermediate November contract: $73.93 per barrel, down $1.63, or 2.16%. Year to date, U.S. crude oil has gained about 3%.
• Brent December contract: $77.44 per barrel, down $1.60, or 2.02%. Year to date, the global benchmark is little changed.
• RBOB Gasoline November contract: $2.1044 per gallon, down 2.19%. Year to date, gasoline is little changed.
• Natural Gas November contract: $2.572 per thousand cubic feet, down 2.28%. Year to date, gas is ahead more than 2%.

The market, meanwhile, continues to monitor the Middle East in anticipation of a retaliatory strike by Israel against Iran. U.S. officials told NBC News that Israel has narrowed down the targets it plans to hit. These include military and energy infrastructure, the officials told NBC.