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Mid-Day Oil Summary: Crude Rallies

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Crude prices are rallying today driven by an added risk premium from the potential for an escalation in Middle East conflict and ongoing attacks on Russian refineries. Gains are limited by a stronger US dollar and the IEA’s downward revision in its oil demand forecast for this year and next year. Brent front month, however, is tracking a weekly net decline.

    • Brent JUN 24 up 1.2% at 90.78$/bbl
    • WTI MAY 24 up 1.3% at 86.13$/bbl
  • The WSJ reported on Thursday evening that Israel is preparing for a direct attack from Iran on southern or northern Israel as soon as the next 24 to 48 hours.
  • The IEA lowered its global oil demand growth for this year by around 100kbpd to 1.2mbpd, partly due to weaker demand in 1Q 2024 according to the monthly oil market report.
  • Chinese crude oil imports in March stood at 49.052mn tons, of 11.55mbpd, and down from 12.3mbpd in April 2023, General Administration of Customs data showed.
  • Russia shot down four Ukrainian drones near Novoshakhtinsk in Russia's Rostov region according to the regional governor, Vasily Golubev on Friday.
  • Growing sanctions pressure and a narrowing Urals discount has dented Russian crude into India according to Vortexa figures.
  • US officials had a secret meeting with Venezuelan President Nicolás Maduro’s administration ahead of the April 18 deadline for energy sanctions to try and keep him engaged in the process to democratic reform.
  • Trans Mountain will introduce oil to the new Line 2 of the Trans Mountain Pipeline system on 16 April, the firm told Bloomberg in an email.
  • Motiva’s 630kbpd Port Arthur, Texas, refinery restarted two CDUs on 11 April and has begun restarting the FCC, sources told Reuters.
  • Marathon’s 291kb/d Catlettsburg refinery in northeastern Kentucky has raised run rates back above 280kb/d and still increasing after falling as low as 200kb/d last weekend according to Bloomberg sources.
  • About 500,000-600,000bpd of Russia’s crude processing capacity could be offline this quarter on a gross basis, before offsets because of the Ukrainian drone attacks according to the IEA’s monthly report.
  • Diesel cracks are rebounding slightly after the recent trend of softening amid seasonally lower demand, while gasoline cracks are extending gains from recent days with a tight US market expected into the summer driving season.
    • US gasoline crack up 0.6$/bbl at 32.03$/bbl
    • US ULSD crack up 0.8$/bbl at 27.39$/bbl
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Crude prices are rallying today driven by an added risk premium from the potential for an escalation in Middle East conflict and ongoing attacks on Russian refineries. Gains are limited by a stronger US dollar and the IEA’s downward revision in its oil demand forecast for this year and next year. Brent front month, however, is tracking a weekly net decline.

    • Brent JUN 24 up 1.2% at 90.78$/bbl
    • WTI MAY 24 up 1.3% at 86.13$/bbl
  • The WSJ reported on Thursday evening that Israel is preparing for a direct attack from Iran on southern or northern Israel as soon as the next 24 to 48 hours.
  • The IEA lowered its global oil demand growth for this year by around 100kbpd to 1.2mbpd, partly due to weaker demand in 1Q 2024 according to the monthly oil market report.
  • Chinese crude oil imports in March stood at 49.052mn tons, of 11.55mbpd, and down from 12.3mbpd in April 2023, General Administration of Customs data showed.
  • Russia shot down four Ukrainian drones near Novoshakhtinsk in Russia's Rostov region according to the regional governor, Vasily Golubev on Friday.
  • Growing sanctions pressure and a narrowing Urals discount has dented Russian crude into India according to Vortexa figures.
  • US officials had a secret meeting with Venezuelan President Nicolás Maduro’s administration ahead of the April 18 deadline for energy sanctions to try and keep him engaged in the process to democratic reform.
  • Trans Mountain will introduce oil to the new Line 2 of the Trans Mountain Pipeline system on 16 April, the firm told Bloomberg in an email.
  • Motiva’s 630kbpd Port Arthur, Texas, refinery restarted two CDUs on 11 April and has begun restarting the FCC, sources told Reuters.
  • Marathon’s 291kb/d Catlettsburg refinery in northeastern Kentucky has raised run rates back above 280kb/d and still increasing after falling as low as 200kb/d last weekend according to Bloomberg sources.
  • About 500,000-600,000bpd of Russia’s crude processing capacity could be offline this quarter on a gross basis, before offsets because of the Ukrainian drone attacks according to the IEA’s monthly report.
  • Diesel cracks are rebounding slightly after the recent trend of softening amid seasonally lower demand, while gasoline cracks are extending gains from recent days with a tight US market expected into the summer driving season.
    • US gasoline crack up 0.6$/bbl at 32.03$/bbl
    • US ULSD crack up 0.8$/bbl at 27.39$/bbl