Crude Ticks up After Falling on Global Demand Concerns

Crude drifted lower throughout the day yesterday on the prospect of lower global oil demand growth. A potential economic slowdown from rising inflation is feeding into the crude prices as the US Fed raised interest rates by 75 basis points.

• Brent AUG 22 up 0.6% at 119.21$/bbl
• WTI JUL 22 up 0.7% at 116.16$/bbl
• Gasoil JUL 22 down -1.5% at 1311.75$/mt
• WTI-Brent down -0.03$/bbl at -5.34$/bbl
• The potential oil demand increase from China remains uncertain as they try to emerge from an extended period of Covid restrictions. Economic data from China suggests a mixed recovery so far. Global supply is still limited with IEA forecasting demand to outweigh supply in 2023.
• EIA weekly oil data released in the afternoon showed a small decline in refined oil product demand which could be viewed as a sign that high fuel pump prices are starting to impact consumption.
• The data showed a draw in gasoline and just a small build in distillate stocks which helped to maintain the bull trend for crack spreads. The US and European diesel spreads both surged to record highs in the afternoon.
• Brent time spreads have followed the flat price lower with the possibility of easing demand growth reducing the tight market expectations very slightly.
• Brent AUG 22-SEP 22 down -0.05$/bbl at 2.99$/bbl
• Brent DEC 22-DEC 23 up 0.4$/bbl at 14.12$/bbl
• US 321 crack up 0.88$/bbl at 57.31$/bbl