Oil Summary at European Close: Crude Slides

Crude futures are now trading lower on the day suggesting the market considers the wider market impact of Russian diesel and gasoline exports ban to be relatively limited with the measure generally expected to be fairly short lived.

• Brent NOV 23 down -0.5% at 92.8$/bbl
• WTI NOV 23 down -0.8% at 89.35$/bbl
• Crude managed money net long positions rose again to the highest since March 2022 according to Commitments of Traders data released on Friday. The combined net long positions for Brent and WTI increased by another +27k to 522k with WTI at a 19 month high and Brent at a six month high.
• ICE Brent November Option Expiry – A total of 473mbbls of current open Nov23 Brent options positions are due to expire against the futures close tomorrow. Current open interest is 230k for calls contracts and 243k for puts.
• Crude floating storage on vessels stationary for at least 7 days rose 11% last week to 95.93mn bbls as of September 22, compared to 86.42mn bbls the week prior according to Vortexa.
• Crude oil exports from Iraq’s Kurdistan region through a pipeline to the Turkish port of Ceyhan are expected to resume as a test soon, a SOMO source told Kurdistan24.
• Russia is succeeded in avoiding G7 sanctions on most of its oil exports, as almost three quarters of all seaborne Russian crude flows in August have travelled without western insurance, allowing Russia to sell its oil above the $60/bbl price cap.
• The average daily oil-processing rates at Russian refineries has fallen to the lowest since late May. Crude processed by refineries in the week to 20 Sep fell by nearly 100kbpd from the previous week to 5.2mbpd.
• China’s Crude Oil Production was 17.47m mt in August, up 3.13% on the year, according to the National Bureau of Statistics.
• Chevron Plans to add a further 65k b/d of Venezuelan oil output by 2024 year-end in its first major drilling campaign since US sanctions were lifted on some operations in the country, according to Reuters.
• US ENERGY POLICY MUST BE MORE CONSISTENT, CHEVRON CEO SAYS -bbg
• Oil-exporting terminals in Corpus Christi, Texas will be able to load more oil onto VLCCs starting from October.
• Oil markets could breach $100/bbl in the short term but Wood Mackenzie forecasts $80-85/bbl in the medium to long term according to Sushant Gupta, research director of Asia refining at Wood Mackenzie.