Crude Holding Steady After two Week Rally

Crude holding near previous close levels after rallying 9$/bbl over the last two weeks on Chinese demand optimism and Russian supply concerns. Uncertainty over global economic growth continues to limit upside market moves but the potential end to the US Fed rate tightening in the coming months and weaker US dollar are also supportive.

• Brent MAR 23 down 0% at 87.59$/bbl
• WTI MAR 23 down 0% at 81.62$/bbl
• Gasoil FEB 23 up 0.6% at 989.5$/mt
• WTI-Brent down -0.01$/bbl at -5.95$/bbl
• The crude forward curve is in strong backwardation with spreads edging higher as the futures have rallied. The Jun23-Dec23 and Dec23-Dec24 spreads are trading near the highest since mid November. The prompt spreads remain in contango although concern for oil supplies following the EU ban on Russian products on 5 Feb have brought the Brent spread back up towards parity at just -0.04$/bbl.
  • Brent MAR 23-APR 23 unchanged at -0.05$/bbl
  • Brent JUN 23-DEC 23 down -0.09$/bbl at 3.02$/bbl
• Diesel and gasoline crack spreads continue to rally on the back of supply concerns and despite weak near term demand. Supply risks come from the EU ban on Russian products, the potential for further French refinery strikes and the upcoming US maintenance season. Europe has been trying to fill storage ahead of the ban with higher supplies from Middle East, US and China although US diesel supplies to Europe were cut in Jan due refinery outages in the US.
  • US gasoline crack up 0.2$/bbl at 29.6$/bbl
  • US ULSD crack up 0.3$/bbl at 59.73$/bbl