OIL: Mid-Day Oil Summary: Crude Trades Through Friday High

Crude has extended the earlier rally through the Brent front month high of $79.3/bbl from Oct. 4 as the market prices in an increasing risk premium amid Middle East conflict and potential disruption to Iran oil output.  The supply risk has more than offset the impact of returning Libya barrels to the market.

• Libya’s oil production is back above 1mbpd for the first time in 2 months after the recent resolution to the central banker disagreement Bloomberg sources said.
• Saudi Arabia increased the crude premium to customers in Asia by more than expected by $0.9/bbl for November but cut the OSP for cargoes to Europe and the US.
• Goldman Sachs estimates that Brent could increase to the $90s if Iranian oil production was disrupted but upside would be dependent on if OPEC offset any lost supply, according to Bloomberg.
• Hurricane Milton is intensifying as it heads towards Florida but the impact on energy appears to be limited.
• Norway's government draft budget projects oil liquids production to rise by 5.2% y/y in 2025.
• Money managers cut net long crude positions slightly last week with a rise in bullish Brent positions offset by a fall in WTI net longs. Funds reduced the bearish ICE Gasoil and Nymex diesel positioning slightly.
• Delek’s 73,000 bpd Big Spring refinery in Texas had an equipment malfunction at a light distillate hydrotreater on October 4.
  • Brent DEC 24 up 2.4% at 79.89$/bbl
  • WTI NOV 24 up 2.8% at 76.43$/bbl
  • US gasoline crack down 0.8$/bbl at 12.74$/bbl
  • US ULSD crack down 0.3$/bbl at 22.7$/bbl