Oil Summary at European Close: Crude Sees Slight Uptick

Crude markets are up marginally after yesterday’s fall with little indication that Israel’s ground offensive has caused the conflict to spread to the wider Middle East. Israeli PM Benjamin Netanyahu yesterday said that Israel will not agree to any ceasefire with Hamas.

• Brent DEC 23 up 0.2% at 87.65$/bbl
• WTI DEC 23 up 0.1% at 82.42$/bbl
• The API oil inventory data is due for release today at 16:30 ET. EIA are today due to update the monthly petroleum supply and the crude oil and natural gas production data for August.
• Nymex WTI open interest has halted the declining trend seen for much of October and back up to 1.67m from a low of 1.62m last week but compared to 1.8m seen at the start of the month.
• The latest China Manufacturing October PMI showed a downside surprise back to mid year levels at 49.5 adding to uncertainty over the strength of the China economy towards year end.
• Fundamentals will be key in driving oil prices, as the effect of the Israel-Hamas war on crude is starting to wane, with Brent crude oil to trade around $90-100/bbl over the next 12 months, UBS said in a note.
• OPEC oil output rose for the third straight months in October, according to a Reuters survey Oct. 31. OPEC pumped 27.9m b/d in October, the survey found, up 180k b/d in September.
• OPEC+'s aggressive output cuts are set to tighten the market once again despite soft demand according to Bloomberg Intelligence. Oil prices have yet to see a significant spike due to the Israel-Hamas war but any escalation of the conflict is an upside risk to prices in the near term.
• OPEC Africa crude exports rise to a multi-year high in October led by an increase from Nigeria according to Kpler.
• US crude production rose from 12.96mbpd in July to a record high of 13.05mbpd in August surpassing the pre-covid levels and up from 11.99mbpd in Aug 2022.
• Venezuela’s Supreme Justice Tribunal said Monday it has suspended the results of the opposition presidential primary that took place this month, further complicating the stance of US towards Venezuelan oil and gas sanctions which it eased earlier this month in return for fairer elections in the country.
• Russian crude exports are on track to hit a four-month high pace, according to Platts vessel tracking.
• Russia’s crude oil flows have climbed for the third consecutive week and are above the targets in their agreement with Saudi Arabia, according to Bloomberg. Russia’s crude shipments averaged 3.64m b/d in the week to Oct. 29, up 3% on the previous week.
• Kpler and Vortexa figures show India’s imports of Russian oil in October between 1.49-1.57m b/d, an 8-12% decline on the month.
• India’s crude oil imports in September rose by 3.9% year on year to 17.4 million tons but down compared to 18.7 million tons in August, according to data from the oil ministry’s Petroleum Planning & Analysis Cell.
• The Panama Canal Authority is currently taking further steps to reduce traffic by reducing the number of ships that can cross, and force those that are allowed to pass to reduce their drafts, amid drought after precipitation in October fell to the lowest on record since 1950, according to a statement.