Crude Supply to Improve Amid Refinery Works; Product Capacity Tight: Vitol

Global crude oil supplies are expected to improve in the next six to eight weeks because of refinery maintenance according to Vitol CEO Russell Hardy.

• Sour crude economics will remain stronger than sweet because of the OPEC+ cuts with insufficient sour crude supply for complex refineries in India, Kuwait, Jizan, Oman and China.
• Tight refining capacity is driving oil product volatility after refinery closures during Covid and the West really doesn't have the product making capacity it needs, he said.
• Western sanctions on Russia are working and creating less or lower revenues, lower invoice prices for Russian goods but creating stronger bonds between BRICS countries. The measure has also led to higher shipping costs with Europe paying a higher price for products with refining being outsources to Asia.
• Hardy doesn’t necessarily expect a huge jump in exports from Iran if sanctions are eased after production has already increased over the past couple of years to about 3.1mbpd. He also expects "a little more oil" to be legally exported from Venezuela as more export licenses have been made available.