Headwinds From Both Sides Of The Coin

WTI & Brent sit $1.30-1.40 below their respective settlement levels in early trading this week, with a combination of supply and demand side matters pressuring crude.

• On the supply side there has been another uptick in Libyan crude production (which now sits at 800K bpd vs. less than 100K bpd in early September), while U.S. Gulf of Mexico facilities have started to come back online after the latest round of weather related disruption, with ~46% of the region's production shut in, per the latest BSEE count.
• Meanwhile, the latest round of lockdowns in the UK & mainland Europe provide further pressure from the demand side.
• The sell off came even as trading giant Vitol pointed to no real chance of a violent move lower, referring to the latest round of demand side issues as a "speed bump."
• We should highlight that the benchmarks currently sit the best part of $1.00 off intra-day lows, aided by a bounce in e-minis and the Nikkei 225.