Crude Edges Higher on Russian Supply Uncertainty and Weaker USD

Crude trading higher today with a weaker US dollar supporting prices ahead of the US Fed rate decision on Wednesday.

• Concerns for Chinese demand had weighed on prices yesterday but they rallied after OPEC Secretary General Haitham Al Ghais again defended the OPEC+ production cut for November and December. OPEC raised their medium to long term demand forecasts due to more robust 2022 and 2023 and a slower substitution of oil by other fuels.
  • Brent JAN 23 up 1.3% at 94.02$/bbl
  • WTI DEC 22 up 1.2% at 87.58$/bbl
  • Gasoil NOV 22 down -1% at 1088.75$/mt
  • WTI-Brent up 1.05$/bbl at -7.53$/bbl
• Uncertainty over the ability for Russia to find alternative buyers for oil after the introduction of the EU ban on supplies is also supporting the market. Europe is still receiving about 740kbpd of seaborne crude and 650kbpd of crude through the Druzhba pipeline.
  • Brent JAN 23-FEB 23 up 0.03$/bbl at 1.82$/bbl
  • Brent FEB 23-MAR 23 up 0.07$/bbl at 1.62$/bbl
• US G7 price cap on Russian oil sales will temporarily exempt cargoes loaded before the Dec 5 ban but must be delivered before Jan 19.
• Diesel and Gasoline crack spreads are following crude and edging higher after drifting lower yesterday. Low stocks and tight supplies continue to provide support despite economic concerns and high prices weighing on demand.
  • US 321 crack up 0.4$/bbl at 36.23$/bbl
  • US gasoline crack up 0.1$/bbl at 19.63$/bbl
  • US ULSD crack up 1$/bbl at 69.55$/bbl