Crude Supported by Potential for Lower Supply

Crude is recovering lost ground from yesterday with output from the CPC terminal and potential OPEC production cuts supporting prices.

• Crude fell late in the session yesterday on the back of hawkish headlines from Fed officials ahead of a speech by Feb Chair Jerome Powell at the Jackson Hole Symposium later today. Oil market concerns for demand continue to weigh on prices as high inflation causes future central bank rate hikes.
  • Brent OCT 22 up 1% at 100.38$/bbl
  • WTI OCT 22 up 1.1% at 93.55$/bbl
  • Gasoil SEP 22 up 0.4% at 1178.25$/mt
  • WTI-Brent down -0.01$/bbl at -6.83$/bbl
• Kazakhstan yesterday confirmed the third CPC mooring had passed inspection after two had been taken out of service due to cracks. The reduced loading potential and ongoing field outages are restricting Kazakhstan output.
  • Brent OCT 22-NOV 22 up 0.01$/bbl at 0.89$/bbl
  • Brent DEC 22-DEC 23 up 0.22$/bbl at 10.3$/bbl
• Time spreads are relatively stable this morning after forward curve backwardation has steepened this week on the back of lower supply expectations.
• Ongoing economic concerns after weak gasoline demand have caused a slump in gasoline margins this week but the spreads are holding steady this morning after bouncing back slightly yesterday. Diesel remains strong due to limited supplies and low stocks while demand has held up stronger than gasoline.
  • US 321 crack up 0.5$/bbl at 36.11$/bbl
  • US gasoline crack down -0.2$/bbl at 18.67$/bbl
  • US ULSD crack up 0.8$/bbl at 71.02$/bbl