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Mid-Day Oil Summary: Crude Trades Lower

OIL

Crude prices are trading lower today and have fallen to the lowest since 10 January amid concerns for economic growth in China after Q4 growth data came in slightly below expectations, a higher US dollar and yesterday’s remarks from the Fed’s Waller saying there is no need for rapid rate cuts. This is offsetting the supply risks from Red Sea disruptions and Libya.

    • Brent MAR 24 down -1.5% at 77.1$/bbl
    • WTI FEB 24 down -1.8% at 71.12$/bb
  • WTI Feb24 Option Expiry Today: A total of 457mbbls of open February 24 options positions on CME and ICE are due to expire against the February futures close today. Current aggregate open interest is 274k call contracts and 182k puts.
  • China’s economy showed a below expectation growth of 5.2% in Q4. China crude processing in December rose 1.1% to 60.11 tons as processing in 2023 reached a record up 9.3% y/y to 734.78m tons amid post covid demand. Apparent oil demand rose 11% to 14.42mb/d according to Bloomberg.
  • Global oil markets are able to cope with Red Sea disruptions in the short term, but prolonged attacks could lead to tanker shortages in an already tightening oil market, Aramco CEO, Amin Nasser, told Reuters.
  • The updated monthly oil reports from OPEC will be published today at around 13:45 CET. The day delayed API oil inventory data is due at 16:30 ET.
  • ARA crude stocks rose 838k bbl or 1.6% in the week ended Jan 12 to 54.2mn bbls according to Genscape.
  • CPC resumed oil loading on Wednesday after suspensions due to weather.
  • Observed crude oil shipments into Europe from the USGC are set to remain at around 2m b/d for a second successive month, according to Bloomberg citing tanker tracking data.
  • Crude oil processing at refineries in India rose 1.8% y/y to 22.7m tons (5.37mb/d) in December according to preliminary data from Petroleum Planning and Analysis Cell via Bloomberg.
  • Russian Deputy Minister Alexander Novak plans to hold a meeting on January 19 with refiners on the current state of the domestic oil products market according to Interfax.
  • UAE oil product stockpiles at the port of Fujairah fell 1.2% in the week ended Jan.15 – the second consecutive weekly decline.
  • US diesel and gasoline cracks erased gains yesterday after an earlier surge after confirmation that operations at the Baywater refinery are not disrupted. Separate refinery outages, higher gasoline demand, and severe cold weather in the US this week have been adding support.
  • Valero Energy began a planned overhaul on the large CDU at its 335,000-bpd refinery in Port Arthur on Monday according to Reuters sources Tuesday.
  • ExxonMobil’s Joliet refinery Illinios, had sulphur dioxide gas flaring Jan. 16 from an unknown issue according to a regulatory filing.
    • US gasoline crack up 0$/bbl at 17.01$/bbl
    • US ULSD crack up 0.6$/bbl at 39.93$/bbl

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