The July Brent futures flat price has seen a slight uptick this morning, with price action initially remaining flat around $87.50/bbl handles between 03:30 and 07:30 BST, before briefly weakening to as low as $87.33/bbl at 07:40 BST. Since then, there has been a minor rally to hit $88.00/bbl at 11:45 BST (time of writing). China’s total oil product demand fell by 967kbbls/d to a 13-month low, with its imports also having fallen by 667kbbls/d. It has also been reported that China’s NDRC will cut retail gasoline and diesel prices by 70 yuan/mt respectively, starting on Apr 30. In more potentially bullish news, Dubai has approved a new $35 billion airport five times bigger than DXB, with ENOC having built a pipeline to the new site, which will potentially boost jet fuel demand in the Emirate. In geopolitical news, the US military says it engaged five unmanned drones over the Red Sea that “presented an imminent threat to US, coalition, and merchant vessels in the region”. US central command did not say in the statement if the drones were destroyed. Looking at the CFTC data for the week to Apr 23, in Brent futures we witnessed a change of heart, as sentiment flipped to a more bearish attitude. Bullish speculators removed over 30mbbls (-7.7%) of their length whilst their bearish counterparts added 1.7mbbls (+2.1%) to their positions. In WTI futures, bullish money managers removed 29mbbls (-10.8%) of their long positions, whilst short positioned players also exited positions, decreasing their short risk by 4.5mbbls (-5.5%).
