OIL: Crude Weighs Supply Risks with Soft China Oil Imports

Brent crude is holding just above the lows from early this week of $75.05/bbl as the market assesses an unexpected build in U.S. crude oil inventories in API data, an escalating Middle East conflict, Libya's Sharara output halt and soft China oil import data.

• Risk of a retaliation by Iran on Israel remains a risk amid concerns of a wider conflict in the Middle East and potential impact on supplies from the region.
• China’s crude imports fell to the lowest since September 2022 with volumes in July down 3.1% y/y and 12% m/m to 42.34mn tons and refined products fell 7.3% m/m to 4.98m tons. Weak margins and low fuel demand have curbed operations at state-run and independent refineries.
• The EIA has kept its forecast for global oil demand in 2024 stable at 102.9mb/d in its August Short Term Energy Outlook. Demand for 2025 has been revised down 0.2mb/d to 104.5m b/d due to a softer China.
• API data showed US crude inventories rose 0.176mbbl, according to Bloomberg, counter to expectation for another weekly draw in the official EIA data out later today. 
• Diesel and gasoline cracks edged lower again yesterday amid a rise in API gasoline and distillates stocks and with weaker global demand and robust product flows weighing on diesel.
  • Brent OCT 24 up 0.1% at 76.55$/bbl
  • WTI SEP 24 up 0.2% at 73.31$/bbl
  • Brent OCT 24-NOV 24 up 0.02$/bbl at 0.47$/bbl
  • Brent DEC 24-DEC 25 down 0.01$/bbl at 3.03$/bbl
  • US gasoline crack down 0.3$/bbl at 23.74$/bbl
  • US ULSD crack down 0.1$/bbl at 23.27$/bbl