Oil Summary at European Close: Red Sea Disruption Boosts Crude

Crude front month futures have risen strongly on the day, as more shippers halt transits through the Red Sea region after two further attacks on vessels by Houthi rebels.

• Brent FEB 24 up 2.9% at 78.77$/bbl
• WTI JAN 24 up 3% at 73.56$/bbl
• Vessel attacks in the Red Sea are increasing. Yemen’s Iranian-backed Houthi rebels have claimed responsibility for attacks on two ships Dec. 18 - the Swan Atlantic and MSC Clara - using naval drones, according to Alarabiya news.
• BP and Euronav are the latest companies to pause all of its tanker traffic through the Red Sea, while Equinor is redirecting its vessels.
• Russia announced it will extend its existing exports cuts by potentially 50kbpd or more in December, deepening its cuts beyond the 300kbpd previously agreed for this month, Russian Deputy PM Alexander Novak said.
• Russian oil processing rose to around 5.7mbpd in the week to 13 December, up by around 368kbpd from the first six days of the month according to a person with knowledge of the matter.
• Oil exports out of Texas are surging in the final weeks of 2023, according to Reuters, driven by record production levels and the need to avoid high year-end taxes on inventories.
• The amount of crude oil held around the world on tankers stationary for at least seven days fell 13% on the week 73.32m bbl as of Dec. 15, Vortexa data showed.
• Goldman Sachs has cut the Brent forecasts for 2024 by 10$/bbl to an average of 81$/bbl with only a “modest deficit”.