Various Supply Risks Support Crude Markets

Economic concerns and central back tightening due to high inflation have underlined the market but recent supply risks are adding support with Brent trading higher this morning.

• Brent NOV 22 up 0.7% at 98.55$/bbl
• WTI OCT 22 up 0.7% at 92.32$/bbl
• Gasoil SEP 22 up 2.1% at 1145.75$/mt
• WTI-Brent up 0.06$/bbl at -7.73$/bbl
• Crude fell back over 5% yesterday, losing the previous days’ gains, after the head of the Iraq state marketer, SOMO, said that protests in the capital were not affecting productions and exports. They added they have capacity to boost oil exports to Europe if asked.
• Other supply concerns include the reduced Kazakhstan output from the CPC terminal, clashes in Libya, drawn out Iran nuclear discussions and the potential for OPEC to cut production at their meeting on Sep 5.
  • Brent NOV 22-DEC 22 up 0.06$/bbl at 1.44$/bbl
  • Brent DEC 22-DEC 23 up 0.15$/bbl at 10.83$/bbl
• The easing outright crude prices were followed yesterday by softer curve backwardation with time spreads pulling back to start of the week levels. The spreads have rallied since mid Aug due to the various ongoing supply risks.
  • US 321 crack up 0.4$/bbl at 32.5$/bbl
  • US gasoline crack up 0$/bbl at 14.67$/bbl
  • US ULSD crack up 1$/bbl at 67.66$/bbl
• Product margins are steady this morning after API data showed draws in both gasoline and distillate stock last night. Gasoline spreads lost further ground yesterday with demand concerns weighing on prices.