Crude Extends Yesterdays Gains

Crude is extending yesterdays gains with lingering questions about the return of the Keystone pipeline adding supply concerns for the world’s biggest crude consumer. WTI climbed over $74/bbl yesterday, a 3% gain and the first gain in seven sessions.

• Brent FEB 23 up 1.6% at 79.2$/bbl
• WTI JAN 23 up 1.4% at 74.17$/bbl
• Gasoil JAN 23 up 1% at 853$/mt
• WTI-Brent down -0.17$/bbl at -4.86$/bbl
• Keystone has remained shut since a 14,000 bbl leak was reported December 7. TC Energy did not release a timeline for re-opening in a statement on Sunday and said they had not discovered the cause of the leak yet.
• Crude markets have also been boosted on expectations that China’s zero-Covid policy will continue easing, ushering in higher demand. Surging infections in major Chinese cities is reigning in some of the optimism.
• Time spreads continue to signal ample near-term supply, with the prompt spread for WTI and Brent holding in contango. The gap between the two nearest contracts for the global benchmark was 29 cents a barrel in contango, compared with $1.58 a barrel in backwardation about a month earlier.
• WTI JAN 23-FEB 23 down -0.01$/bbl at -0.12$/bbl
• Brent FEB 23-MAR 23 up 0.1$/bbl at -0.25$/bbl
• Weaker oil product demand has also been weighing on diesel and gasoline crack spreads. GasBuddy placed gasoline demand at 8.4mn bpd last week, 2% lower than the week prior.
• US gasoline crack up 0.1$/bbl at 14.34$/bbl
• US ULSD crack up 0.1$/bbl at 50.85$/bbl