Crude Eases Lower After Supply Risk Driven Gains Yesterday

Crude has ticked lower in early trading today after a rally yesterday driven by the chance that the US will reinstate sanctions on Venezuela, limited short term hope for a ceasefire in Israel, tighter supplies from OPEC+ output cuts in Q2 and a weaker US dollar.

• Brent MAY 24 down 0.3% at 86.53$/bbl
• WTI MAY 24 down 0.2% at 81.76$/bbl
• Gasoil APR 24 down 0.2% at 828.25$/mt
• WTI-Brent unchanged at -4.77$/bbl
• OPEC+ delegates see current supply curbs as effective according to Bloomberg sources with no recommended changes to supply policy expected at a review meeting next week.
• Russian oil companies have been ordered to reduce output in Q2 to ensure they meet a production target of 9mbpd by the end of June in line with its pledges to OPEC+ according to Reuters sources.
• India has stopped buying Venezuelan oil because of the possibility of the US waiver of sanctions on Venezuela won’t be renewed.
• Yemen’s Houthi’s have renewed threats against Saudi Arabia, warning it not to support US air strikes against the group.
• Focus is still on Russia with further Ukrainian drone attacks over the weekend. The impact of the refinery disruptions is mixed “with a bearish effect from the decline in refinery demand and a bullish effect from the potential reduction in Russia oil exports," according to Goldman Sachs.
  • Brent MAY 24-JUN 24 down 0.03$/bbl at 0.64$/bbl
  • Brent JUN 24-DEC 24 down 0.09$/bbl at 4.16$/bbl
• US diesel and gasoline cracks edged lower yesterday as US refining capacity is coming back online from spring maintenance. Gasoline spreads however remain up on the month amid a seasonal increase in demand.
  • US gasoline crack down 0$/bbl at 32.5$/bbl
  • US ULSD crack down 0.1$/bbl at 29.9$/bbl