News Archive

Overnight & Singapore Window: Brent Strengthens back to $77.70/bbl

The October Brent Futures contract saw a recovery this morning, trading from the day’s low of $76.59/bbl at 09:30 BST up to $77.80/bbl, at the time of writing, 11:15 BST. In headlines, a major fire has continued into today at a Russian oil depot in the Rostov region, following a Ukrainian drone attack on the Kavkaz oil facility. The attack, 150 miles from the Ukrainian border, triggered a Russian air defense response, leading to drone debris striking the facility, with a governor of the southwest Russian region stating on Sunday that the drone ignited a diesel fuel fire at an industrial warehouse. Local media reported that at least 40 firefighters had been injured, with Ukrainian officials claiming responsibility, stating the depot supplied oil to the Russian military. In the U.S., former President Donald Trump, speaking in Pennsylvania, promised to cut energy costs by reversing federal policies if elected in 2024. He criticized Biden’s green energy initiatives and warned that if Kamala Harris wins, “energy costs would triple and quadruple,” and the U.S. would “not be producing a drop of oil.” Trump emphasized boosting U.S. oil production, referring to it as “liquid gold” and advocating for energy independence. The Oct/Nov and Oct/Apr’25 Brent Futures spreads also experienced some recovery following yesterday’s fall, trading at $0.55/bbl and $2.20/bbl respectively, at the time of writing.

Onyx Alpha: Testing Sentiment

Another week brings another selection of new trade ideas from Onyx Research, this time looking at trades in Sing fuel oil and NWE gasoline.

Gasoline Report: Bears: “So anyway, I started blasting”

The gasoline market has capitulated in the last week as the bears woke up from hibernation, putting the summer demand story to bed. Initial short-covering flows earlier this months gave bulls false hope as outright prices gapped down, breaking below previous support levels and falling to the lowest level since January 2024. The front-month September EBOB crack sold off from $15.50/bbl to $12.50/bbl, while the Sep/Oct EBOB spread fell from $45/mt to $38/mt.

European Window: Brent Falls to Sub-$78.00/bbl

Oct’24 Brent futures flat price rose to over $79.40/bbl at 14.00 BST before it was pressured to $77.96/bbl at 17.19 BST (time of writing). Secretary of State Antony Blinken arrived in Tel Aviv to push for a Gaza ceasefire, but Hamas accused Israel of undermining the effort. Netanyahu described his meeting with Blinken as “positive” and “conducted in good spirit.” Hezbollah claimed attacks on Israeli military sites, including Zabdin and Ramim barracks, and a missile strike near the Lebanon-Israel border. APA Corp is exploring the sale of oil and gas assets in the Permian Basin, valued at around $1 billion. The sale, managed by RBC Richardson Barr and Truist Securities, aligns with APA’s focus on shale production and debt reduction. The assets produce over 22,000 barrels of oil equivalent per day, with 60% being oil. Oil production in Libya’s Waha field has been restored to normal levels, of around 300kb/d. The Oct/Nov and Oct/Apr’25 Brent spreads are at $0.63/bbl and $2.25/bbl, respectively.

CFTC Weekly: (Not So) Risky Business

Last week, the Oct’24 Brent futures failed to hold strength after the highs of $82.50/bbl on 14 Aug was not maintained as the geopolitical risk emanating from the Middle East has become somewhat normalised as Iran’s retaliation continues to brew amid ceasefire negotiations in Doha. It seems the focus of the market is on macroeconomics this week, as the Jackson Hole gathering of the Fed will hopefully give clues to the extremely hands-off crude market.

Brent Forecast: 19th August 2024

Although Brent crude futures saw a solid start last week, price action closed below $80/bbl on Friday. Middle East geopolitical concerns have eased alongside poor Chinese demand sentiment, amid weaker-than-expected economic data. The Oct’24 contract is trading at $79/bbl as

CFTC Weekly: Away With the Bear-ies

Risk assets saw more calm in the week ending 13 Aug, with crude oil specifically enjoying the newfound sentiment. However, this shift away from the previous three weeks’ bearishness was more a product of de-risking than one of bullish positioning.

Overnight & Singapore Window: Brent fails to climb above $79.50/bbl

The Oct’24 Brent futures contract stood above $79.50/bbl at 08:00 BST today but slid off to $78.80/bbl by 11:25 BST (time of writing). The Oct/Nov Brent futures spread also softened from above $0.80/bbl at 07:00 BST to $0.75/bbl at the time of writing).

Daily Trade Idea: 19/08/2024

Long Sep 3.5 barges cracks With less volumes of HSFO coming into Northwest Europe from the US, the recent tightness has seen prices rise. We are following the trend with this trade.

European Window: Brent Strengthens to $79.70/bbl

The October Brent futures flat price has seen a strong afternoon, trading from a low of $78.64/bbl at 12:30 up to $80.06/bbl at 14:50 before retracing and settling around $79.73/bbl at the time of writing (17:20 BST). In headlines, data has emerged highlighting that China was the top buyer of Russian crude in July, purchasing 47% of Russia’s total exports, followed by India with 37%, the latter amounting to $2.8 billion, according to the Centre for Research on Energy and Clean Air (CREA). Furthermore, around 80% of India’s fossil fuel imports from Russia were crude oil, while India accounted for 18% of Russia’s coal exports, second to China, which purchased 45%. Russia has become India’s leading oil supplier since the invasion of Ukraine, and more Indian refiners are now exploring long-term oil supply deals with Russia; Some of India’s private refiners, including Nayara Energy—partially owned by Russia’s Rosneft—and Reliance Industries, which runs the world’s largest refinery in Jamnagar, have already secured long-term agreements to buy Russian oil. The Oct/Nov and Oct/Apr’25 Brent spreads are at $0.77/bbl and $2.69/bbl, respectively.

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