WTI-Brent Drifts Lower as Crude Holds Steady

Crude futures and spreads are stable so far today with Brent trading in a tight range between 82.1$/bbl and 83.6$/bbl. Market focus has been on the downside risks to demand since hawkish comments from US Feb Chairman Powell earlier in the week taking over from the upside risks of an oil demand recovery in China.

• Disruption to Russian output remains an uncertainty with seaborne exports maintaining above 3mbpd despite the EU and G7 sanctions and the expected production cut during March.
• Near term options volatility skew has turned more bearish this week with the second month skew falling since the start of the month. The Dec23 skew however is holding onto gains from recent months with a recovery in global oil demand expected later this year.
• Time spreads also remain unchanged on the day while the WTI-Brent is drifting back down towards -6$/bbl driven by concern for US central bank rate hikes.
• Technical support Brent May23 is at the 8 Mar low of 82.06$/bbl and the 23 Feb low of 80.25$/bbl.
  • Brent MAY 23 up 0.4% at 82.96$/bbl
  • WTI APR 23 up 0.3% at 76.88$/bbl
  • WTI-Brent down -0.06$/bbl at -5.93$/bbl
  • Brent MAY 23-JUN 23 up 0.02$/bbl at 0.49$/bbl
  • Brent JUN 23-DEC 23 up 0.02$/bbl at 2.48$/bbl