Mid-Day Oil Summary: Crude Reverses Gains

Crude futures and spreads have reversed earlier gains as the market weighs the potential for a market surplus next year amid lack of confidence that OPEC+ voluntary cuts can offset the non-OPEC supply growth and potential slower demand growth from China.

• Brent FEB 24 down -0.5% at 75.46$/bbl
• WTI JAN 24 down -0.6% at 70.81$/bbl
• Crude managed money net long positions fell to the lowest since the end of June according to the Commitments of Traders data released on Friday.
• Saudi Aramco has notified at least three buyers in North Asia that the firm will supply full contractual volumes of crude oil in January 2024, while buyers have asked for less supply amid high January OSPs to Asia.
• Venezuelan President Nicolas Maduro is set to meet Guyana President Mohamed Irfaan Ali on Thursday over the recently escalating border dispute between the two nations based on a letter from the prime minister of Saint Vincet and the Grenadines.
• Global floating crude storage on tankers for at least seven days rose to 79.87mn bbls as of December 8 according to Vortexa – 11% higher than the week prior.
• North Sea crude loadings for its 13 main grades are scheduled to drop to 1.93mn bpd in January from 2.05mn bpd in December according to Bloomberg.
• Russian diesel flows to Brazil are expected to remain steadily strong in early 2024, as Brazilian buyers rely on cheap imports due to the latest domestic diesel price adjustment from Petrobras, according to market sources, cited by Platts.
• China is allowing crude oil import quotas for 2024 to be used by independent refineries in December according to S&P Global.
• Exxon Mobil plans to shut down a chemical unit Monday at its Port Jerome-Gravenchon refining and petchem complex, according to a community alert.
• Motiva’s Port Arthur Texas refinery plans to shut its 345k bpd VPS-5 crude unit the first week of January and begin maintenance on it January 8 according to Bloomberg sources.
• Ongoing weakness in demand and robust US inventories has been weighing on crack spread with US diesel at the lowest since July.
• A record number of 7.5mn people are expected to fly during 23 December and 1 January 2024, marking the busiest year-end flight travel season since at least 2000, AAA said.
  • US gasoline crack down 0$/bbl at 15.15$/bbl
  • US ULSD crack up 0.1$/bbl at 37.36$/bbl