Crude Steady After Recent Recovery

Crude holding on to the gains from recent days as concerns form economic growth are balanced against upside supply risks and the recent softer dollar.

• Brent NOV 22 up 0.3% at 94.25$/bbl
• WTI OCT 22 up 0.4% at 88.11$/bbl
• Gasoil OCT 22 down -2.1% at 1069.25$/mt
• WTI-Brent up 0.04$/bbl at -6.52$/bbl
• The ongoing Chinese covid related restrictions continue to weigh on the market with the potential impact on their oil demand. Their oil consumption in Jan- July this year was previously reported down 4.6% from last year because of their Covid Zero policy. Hope for an Iran nuclear deal is low after US Secretary of State said it was “unlikely” an agreement would be reached anytime soon.
  • Brent NOV 22-DEC 22 up 0.02$/bbl at 1.09$/bbl
  • Brent DEC 22-DEC 23 up 0.47$/bbl at 9.73$/bbl
• The upside supply risks are maintaining strength in time spreads which have recovered since a dip mid last week. Uncertainty remains over global supplies later this year with the ending of the current US SPR release plan, potential for further reaction from OPEC and the impact of the EUA ban and US lead price cap on Russian crude output.
  • US 321 crack down -0.2$/bbl at 31.39$/bbl
  • US gasoline crack up 0.8$/bbl at 15.74$/bbl
  • US ULSD crack down -0.6$/bbl at 62.78$/bbl
• Diesel and gasoline crack spreads are also holding steady with weak demand offsetting limited refining capacity and low supplies. OPEC and IEA will both release their updated monthly reports this week which will provide forecasts for the upcoming oil market balance.