Crude Ticks Higher Ahead of Weekend OPEC+ Meeting

Crude markets are trading higher this morning supported by a weaker dollar US and amid rising speculation that the OPEC+ group could announce a reduction in crude output targets at the upcoming meeting. The support comes after a trend lower since mid October driven by rising crude supply expectations and building US inventories and amid ongoing global demand uncertainty.

• Brent JAN 24 up 0.8% at 81.23$/bbl
• WTI JAN 24 up 0.8% at 76.64$/bbl
• Gasoil DEC 23 down -0.1% at 804.25$/mt
• WTI-Brent down -0.08$/bbl at -4.59$/bbl
• Saudi Arabia and Russia are widely expected to extend their voluntary production cuts into 2024. OPEC+ is set to consider whether to make additional oil supply cuts amid concerns for demand into 2024, with the potential of a supply surplus next year according to Reuters. The next OPEC+ ministerial meeting will be held on 26 November in Vienna.
• Middle East tensions are still an upside risk to prices with shipping in focus after Iran-backed Houthi Rebels seized a Japanese chartered vessel in the Red Sea on Sunday according to Bloomberg.
  • Brent JAN 24-FEB 24 up 0.01$/bbl at 0.12$/bbl
  • Brent JUN 24-DEC 24 up 0.06$/bbl at 1.82$/bbl
• Crude backwardation remains much softer than seen over the last couple of months despite a slight rally in time spreads on Friday. The Jan24-Feb24 spreads are trading back in positive territory after falling into contango last week ahead of the WTI Dec23 contract expiry today.
• Diesel cracks are steady after falling late on Friday to reverse some of the gains seen earlier in the week after a large draw in US inventories in the last couple of weeks. Gasoline cracks are holding onto gains seen in recent weeks as the Russian government plans has lifted the ban on gasoline exports from 17 November as supplies in the domestic market have improved.
  • US gasoline crack up 0$/bbl at 15.83$/bbl
  • US ULSD crack up 0.5$/bbl at 40.7$/bbl