Crude Steady as Supply Risks Support Weekly Gain

Crude is higher on the week despite central bank tightening, economic recession concerns and a strong dollar driving prices gradually lower since June. Upside supply risks have supported prices, especially the potential for a cut to OPEC+ production targets and from increased tensions with Russia.

• Brent DEC 22 up 0.1% at 87.31$/bbl
• WTI NOV 22 up 0.1% at 81.28$/bbl
• Gasoil OCT 22 down -2.3% at 988$/mt
• WTI-Brent up 0.03$/bbl at -7.22$/bbl
• OPEC+ look likely to discuss a production cut at their meeting on Oct 5 next week after Russian called for a 1mbpd cut earlier in the week. A Bloomberg survey suggests 18 of 19 traders and analysts are expecting cuts.
• Increased Russian tensions are adding to uncertainty over global oil supplies and supporting time spreads. Russia may struggle to find buyers once European imports drop further with the introduction of the EU ban on Russia seaborn crude by Dec 5. Time spreads are trading near their higher since the end of Aug or early Sep.
  • Brent DEC 22-JAN 23 up 0.05$/bbl at 1.75$/bbl
  • Brent JAN 23-FEB 23 up 0.06$/bbl at 1.63$/bbl
  • Brent DEC 22-DEC 23 up 0.19$/bbl at 11$/bbl
• Gasoline and diesel cracks spreads are drifting off today after moving higher on the week on supply concerns with as multiple French refineries offline. EIA demand this week showed a slight recovery in product demand, but levels remain well below normal.
  • US 321 crack down -1$/bbl at 30.92$/bbl
  • US gasoline crack down -0.9$/bbl at 18.83$/bbl
  • US ULSD crack down -1.4$/bbl at 54.83$/bbl