Mid-Day Oil Summary: Crude Stabilizes

Crude is stabilizing and trading just above previous close levels having seen a small correction last week from the two-month rally driven by OPEC+ cuts and demand optimism.

• Brent NOV 23 up 0.2% at 93.48$/bbl
• WTI NOV 23 up 0.1% at 90.13$/bbl
• Crude managed money net long positions rose again to the highest since March 2022 according to Commitments of Traders data released on Friday. The combined net long positions for Brent and WTI increased by another +27k to 522k with WTI at a 19 month high and Brent at a six month high.
• ICE Brent November Option Expiry – A total of 473mbbls of current open Nov23 Brent options positions are due to expire against the futures close tomorrow. Current open interest is 230k for calls contracts and 243k for puts.
• Crude floating storage on vessels stationary for at least 7 days rose 11% last week to 95.93mn bbls as of September 22, compared to 86.42mn bbls the week prior according to Vortexa.
• Crude oil exports from Iraq’s Kurdistan region through a pipeline to the Turkish port of Ceyhan are expected to resume as a test soon, a SOMO source told Kurdistan24.
• Canadian crude exports out of US Gulf terminals are expected to soar in October boosted by overseas demand after the production cuts by Saudi Arabia and Russia.
• Russia is succeeded in avoiding G7 sanctions on most of its oil exports, as almost three quarters of all seaborne Russian crude flows in August have travelled without western insurance, allowing Russia to sell its oil above the $60/bbl price cap.
• The average daily oil-processing rates at Russian refineries has fallen to the lowest since late May. Crude processed by refineries in the week to 20 Sep fell by nearly 100kbpd from the previous week to 5.2mbpd.
• China’s Crude Oil Production was 17.47m mt in August, up 3.13% on the year, according to the National Bureau of Statistics.
• Diesel markets have steadied after the initial surge higher last week due to the Russian exports ban which is widely expected to only last a few weeks. Diesel markets remain supported by low inventories and refinery maintenance but strong exports from China and India this month have provided some downside pressure.
• The Russian Energy Ministry has approved an amendment to its export ban to exclude bunker fuel, gasoils and some middle distillates. The diesel ban could move more Persian Gulf vessels to the West, which could tighten supplies in Asia during Q4
• Spain’s Bilbao refinery is restarting the G3 diesel desulfurization unit after planned maintenance.
• US gasoline crack down 0$/bbl at 15.57$/bbl
• US ULSD crack down -0.9$/bbl at 46.07$/bbl