US Daily Oil Summary: SPR Restocking Limited by Physical Constraints

Speaking to Bloomberg TV on restocking the SPR, David Turk, US Department of Energy Deputy Secretary “We are refilling as much as we can, and we have been doing it for the last several months and at this price level we will keep doing it.”.

• On whether the US govt will accelerate purchases as prices fall, Turk said “We will buy as much as we possibly can, but there are some physical constrains given the way the caverns are set up.” Turk said that the US will be buying at least 3m bbl.
• US officials are reviewing potential consequences after Venezuelan President Nicolás Maduro missed the agreed end of November deadline to release detained Americans according to National Security Council spokesman John Kirby on Sunday in a CBS interview.
• US crude exports rebounded in November helped by higher flows to China and increased demand from Canada post refinery maintenance.
• GasBuddy models put US gasoline demand in the week to Dec. 2 at an average of 8.478m b/d, Patrick De Haan, head of petroleum analysis at GasBuddy said on X.
• USD: The 0.6% move higher for the USD index is broadly a function of yield differentials, with Fed ’24 pricing moving away from Friday’s dovish extremes as participants continue to assess the viability/speed of the Fed easing priced into markets. The associated extension of post-inflation Euro weakness and heavy price action for equities are also assisting the greenback recovery.
• POLITICAL RISK: OMB Director Shalanda Young has issued a letter to Congressional leaders warning that funds for Ukraine will run out by the end of the year without additional Congressional authorisation.