Oil Summary at European Close: Crude Finds Support

Crude markets have found further support today, reversing some of the steep losses earlier in the week. Upside comes from a fall in the dollar during the afternoon and the possibility of US Fed rate cuts in September.

• Brent AUG 24 up 1.6% at 79.7$/bbl
• WTI JUL 24 up 1.8% at 75.4$/bbl
• Front month is still net down on the week after the bearish reaction to the OPEC+ plan to increase supply later this year. OPEC retains the flexibility to alter that plan depending on market developments.
• OPEC+ will continue to manage the oil market, even with Saudi plans to boost exports in the coming years, the Kingdom’s energy minister Prince Abdulaziz bin Salman said at the St. Petersburg International Economic Forum, cited by Platts.
• Russia does not rule out a strong growth of oil demand by 2030, even up to 110m-115m b/d. Russia’s Deputy PM Novak said, cited by Bloomberg and Tass.
• The gradual unwinding of 2.2m b/d of voluntary OPEC+ cuts planned for after September could be delayed in markets are weaker than expected: Citi.
• Oil inventory draws over the summer should support Brent back into the high $80s-$90 range by September according to JPMorgan.
• Production has been halted at the Buzzard field in the North Sea since late May and the duration of the stoppage remains unclear, according to Bloomberg.
• North Sea oil floating on-water has risen to the highest volume since Jan 2022 with at least 2.6mbbls of Forties and Gullfaks in floating storage in Europe, according to Vortexa data cited by Reuters.
• China’s crude imports came in at 10.1mbd in May – a slight improvement from April but down 6% y/y according to Vortexa.