Oil End of Day Summary: Crude Boosted by Middle East Tensions

Crude is ending the day higher after comments from Israeli PM Benjamin Netanyahu suggesting a ground invasion will be conducted, as tensions in the Middle East outweigh a patchy demand outlook

• WTI DEC 23 up 1.5% at 85$/bbl
• WTI-Brent down -0.28$/bbl at -4.66$/bbl
• According to Reuters, Netanyahu says: "The timing of an invasion will be reached by consensus," adding that he, "won't give details."
• Crude stocks showed a build while expectations suggested a draw. Crude exports ticked lower on the week but remained high at 4.8mbpd. Imports edged higher on the week to just over 6mbpd, while refinery runs fell to the lowest since March at 15.189mbpd.
• Crude stockpiles at Cushing Oklahoma rose last week by around 213,000 barrels, marking the highest weekly increase since June, after falling to the lower since 2014 in the week prior, EIA data showed. Stocks at Cushing stood at 21.226mbbls as of 20 October.
• Crude inventories in the ARA region rose 80k bbl in the week ending 20 October to 51.2m bbl, with stocks well below the five-year average, Genscape data show.
• The US will likely tighten sanctions on Iranian crude in response to the Israel conflict according to RBC’s Helima Croft in a CNBC interview.
• Iraqi PM Mohammed Shia Al-Sudani said Tuesday that foreign oil companies operating in the Kurdish region had informed him they can resume production within a month if an agreement is reached on oil production costs and contracts.
• China intends to cap its crude oil processing capacity at 1 billion metric tons by 2025 according to the country’s state planning agency. At 243mn tons for 2024, China keeps the crude import quota for private refiners unchanged for a fourth consecutive year.
• As of October 23, total oil product stocks in Fujairah were reported at 16.810 mn bbls - a drop of 1.699 mn bbls or 9.2% w/w.
• China’s imports of Iranian crude/condensate into Shandong are on track for a new high in October as refiners anticipate strong teapot demand according to Vortexa figures. It comes as availability of other sanctioned grades from Russia and Venezuela tighten.
• The IEA has not started discussions about oil stock releases, but members states have asked for monitoring of the situation in the Middle East, Keisuke Sadamori, Director, Energy Markets and Security, told Platts at the Asia Hydrogen & LNG Conference.
• Chevron acquired US producer Hess in a move to secure US onshore, Gulf of Mexico and Guyana assets that could lift Guyana’s production to 1.2mbpd by 2027, from 400kbpd currently according to Kpler.
• MNI Commodity Weekly: US Sanctions Relief for Venezuela Faces Pressure After Opposition Election Result -Full piece here: https://enews.marketnews.com/ct/x/pjJscQOJlL0I6ag0ckgnSw~k1zZ8KXr-kA8x6nEW5X1ptIPjO1OcQ