Global Supply Cuts Supporting Crude Friday

Oil spikes higher supported by signs of tightening supplies from key exporting nations like Saudi and Russia.

• Saudi crude exports slipped 0.6mbd in the first half of July vs June according to Vortexa. Kuwait, Nigeria and Algeria down by the same combined. UAE and Iraq meanwhile rise 0.5mbd.
• Market sentiment towards tightening grows from optimism around Russian exports slipping after soaring volumes for much of this year, despite claims of cuts. The market is finally optimistic about its intent.
• Instead Russia is pushing the crude into refineries and exporting fuels like diesel at near record pace.
• Brent is cementing its position above $80/bbl, likely a price target Saudi cuts were aiming to achieve. Strengthening global benchmarks and tighter diffs for sour crudes is pulling Russian Urals above the $60/bbl G7 price cap.
• Optimism is also growing for Chinese economic stimulus support despite lackluster GDP figures to start the week which weighed on crude.
• Brent SEP 23 up 1.1% at 80.5$/bbl
• WTI SEP 23 up 1.1% at 76.51$/bbl