The October Brent futures flat price contract climbed to $80.85/bbl around 07:35 BST but simmered off $80.05/bbl at 10:40 BST. The benchmark crude futures contract found support at this level and currently sits at $80.20/bbl at 11:25 BST (time of writing). This morning’s strength emerged alongside the rising risk of a regional escalation of the war in Gaza following a rocket strike in the Israeli-occupied Golan Heights over the weekend. While Israel blames the Lebanon-based Hezbollah for the attack and vows retaliation, Hezbollah has denied responsibility for the attack. However, Israeli jets hit targets in southern Lebanon on 28 July. In other news, CFTC data for the week ending 23 July displays a liquidation of over 29mb in money-managed length (-9.90%) from Brent futures alongside an addition of nearly 6.5mb shorts (+5.70%). WTI futures saw a removal of 17.9mb longs (-6.5%) and an addition of over 5.5mb shorts (+20%) in the same week. Finally, the market has also appeared risk-off in anticipation of Wednesday’s US Fed meeting. While the US Fed is expected to keep interest rates on hold, a greater focus will be on whether the central bank hints at a potential cut in September. The Oct/Nov and Oct/Apr’25 Brent futures spreads are currently at $0.70/bbl and $2.68/bbl, respectively.
