Crude Extends Recovery But Still Down on the Week

Crude markets extend the recovery higher before the US May CPI numbers today with support from a potential pause in the US Fed interest rate hikes at the FOMC meeting tomorrow. Front month is still down over 1.5$/bbl this week due to economic driven demand concerns from US and China.

• The update OPEC Monthly Oil Report is due out later today as the market looks for further indication of the potential supply demand balance in the second half of this year. OPEC supply is expected to be lower in H2 after voluntary cuts from several members from the start of May and with Saudi Arabia cutting another 1mbpd in July and potentially beyond.
• A reduction in output from Iraq is also supportive as output lags the country’s OPEC+ quota, including the pledged voluntary cuts, by 265kbpd due to the ongoing halt to pipeline exports via Ceyhan.
  • Brent AUG 23 up 1.5% at 72.95$/bbl
  • WTI JUL 23 up 1.3% at 67.96$/bbl
  • WTI-Brent down -0.16$/bbl at -4.78$/bbl
  • Brent AUG 23-SEP 23 up 0.05$/bbl at 0.07$/bbl
  • Brent DEC 23-DEC 24 up 0.13$/bbl at 2.61$/bbl
  • WTI JUL 23-AUG 23 down -0.01$/bbl at -0.18$/bbl
  • WTI DEC 23-DEC 24 up 0.15$/bbl at 2.84$/bbl