Crude Lower With Economic Uncertainty Easing Upside Pressure

Crude front month is edging lower today as prices bounce between $88.7/bbl and $92.2/bbl since a rally at the start of April. Focus remains on heightened geopolitical risk but with no new developments in either the Middle East or Russia.

• Brent JUN 24 down 0.4% at 89.65$/bbl
• WTI MAY 24 down 0.6% at 84.89$/bbl
• Gasoil MAY 24 down 0.7% at 812$/mt
• WTI-Brent down 0.05$/bbl at -5.23$/bbl
• Upside pressure is limited by a possible delay to Fed cuts this year, weak economic momentum in China and another possible rise in U.S. crude inventories while OPEC+ spare capacity is potentially available in the event of any physical supply issues.
• Israel said it would respond to Iran’s drone/missile attack but when it feels the time is right. Iran replied that it would promptly retaliate.
• Brent and WTI call skews have regained strength to the most bullish since October after a dip lower earlier in the week after record call option traded volumes on April 15.
• The U.S. does not intend to renew the special license granting Venezuela eased energy sanctions unless progress is made towards free and fair elections a State Department spokesperson said on Monday. The deal expires this week on April 18.
  • Brent JUN 24-JUL 24 down 0.01$/bbl at 0.78$/bbl
  • Brent JUN 24-DEC 24 down 0.11$/bbl at 4.4$/bbl
• Gasoline crack spreads are extending a recent rally up to the highest since March 25 ahead of the updated EIA US stocks data today. Tight market concerns remain supportive after another 2.5mbbls draw in gasoline stocks according to API data yesterday which also showed another 4.09m build in crude and small distillates draw.
  • US gasoline crack up 0.1$/bbl at 33.1$/bbl
  • US ULSD crack down 0.2$/bbl at 25.84$/bbl