US Daily Oil Summary: US to Crack Down on G7 Price Cap Evasion

US treasury Secretary Janet Yellen said the US is preparing to crack down on the G7 $60/bbl price cap evasion on Russian oil in a WSJ interview earlier - though comments with the news outlet were limited.

• The US needs harsher sanctions to cut off Iran’s ability to export oil, Former US House Speaker Kevin McCarthy said, cited by Bloomberg. “Allowing Iran to produce more oil makes us weaker”, he said.
• Declining US rig count data is hiding potential productivity strength suggested by other oil field indicators according to Macquarie Group. Strength in drilling permits and labour activity data could indicate the supply chain catching up and/or improving efficiency.
• Safe haven sentiment dominated markets Monday following the surprise attack by Hamas against Israel over the weekend, tempered by a partial absence of US market participants due to the Columbus Day Holiday. US$ index DXY climbed to 106-600 high (+.558) while USD/JPY fell comfortably back below the Y149.00 handle, opening a more sizeable gap with the recent cycle high at 150.16.
• Nonfarm payrolls growth comfortably beat expectations in September, posting +336k vs. Exp. +170k, topping even the highest analyst estimate. This was complimented by a +119k two-month net revision, countering the prior month’s downward adjustment.
• The average hourly earnings data were again softer than expected in September, rising 0.207% M/M (cons 0.3%) afte1r an unrevised 0.237% M/M in August, making for a second month of below-forecast wage gains.
• A Congressional Delegation to China led by Senate Majority Leader Chuck Schumer (D-NY) and Senator Mike Crapo (R-ID) met with Chinese President Xi Jinping today in Beijing.
• The biggest escalation of violence between Israel and Palestinian terrorist group Hamas in decades has significantly escalated political risk in the Middle East and risks a wider conflagration which could be complicated by political dysfunction in the United States.