Nov’24 Brent Futures flat price found support this morning after selling-off on Friday, trading at $71.73/bbl at 07:00 BST and moving up to a high of $72.40/bbl at 10:00 BST, before settling at $71.90/bbl at 11:15 BST (time of writing). The recent weakness in Brent futures was highlighted by ICE COT data, which showed money-managed net length in Brent futures currently sitting at -33.7 mb. In the news today, Chinese refining data has added to bearish sentiment in the market, with refinery run rates falling by 10% on the month in August. ING analysts wrote in a note earlier today that Chinese refiners had been building inventories at a daily rate of 3.2 mb last month, which is the largest monthly increase in inventories since 2015. In addition, China’s domestic retail sales growth has decelerated down to 2.1% y/y for August 2024, moderating from 2.7% growth in the previous month and the expected forecast of 2.5%. In other news, as activity resumes after Hurricane Francine, US Gulf Coast oil production shut-ins drop to around 339 kb/d. However, a fifth of total crude oil production in the Gulf of Mexico remains offline, as per data by Reuters. Finally, Yemen’s Houthi rebels have fired a ballistic missile at central Israel, signalling an escalation in the ongoing conflict and the possibility of further disruption to trade routes in the Red Sea region. At the time of writing, the front month (Nov/Dec’24) and six-month (Nov/May’25) Brent futures spreads are at $0.58/bbl and $1.51/bbl, respectively.
