In addition to our regular Monday CFTC COT analysis report, Onyx Insight will publish its own in-house CFTC COT forecast ahead of the official Friday report. The model forecasts changes in long and short positions using machine learning, utilising Onyx’s proprietary data.
The Feb’25 Brent futures contract weakened this morning, increasing from $73.65/bbl at 07:00 GMT up to $73.95/bbl at 09:00 GMT, before falling back down to $73.50/bbl at 10:55 GMT (time of writing). In the news today, Kremlin spokesman Dmitry Peskov said that Russia will respond to Ukraine’s ATACMS strike on Russian territory, as per Reuters. This came as Russia claimed Ukraine targeted a military airfield on the Azov sea with six US-made ATACMS missiles on 11 Dec. In other news, Rosneft has agreed to supply nearly 500kb/d of crude oil to Indian private refiner Reliance in the biggest energy deal ever between the two countries, according to Reuters. The 10-year agreement amounts to approximately 0.5% of global supply and is worth $13 billion a year. Finally, Norway’s Vaar Energi has discovered additional oil reserves in the Arctic Goliat field, with recoverable resources estimated to be between 4 million and 25 million barrels of oil equivalent, the company said in a statement. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.40/bbl and $1.59/bbl, respectively.
The Feb’25 Brent futures contract was supported this afternoon, rising from $73.00/bbl at 12:00 GMT up to $73.40/bbl at 17:50 GMT (time of writing). In the news today, OPEC’s monthly report has cut oil demand growth forecasts for this 2024 by 210kb/d to 1.6mb/d, marking the fifth consecutive month the cartel has reduced its demand projection, as per Bloomberg. Meanwhile, crude oil production from all OPEC members rose by 104kb/d in November m/m, due to increased output in Libya, Iran, and Nigeria, according to OPEC’s secondary sources. Nigeria’s oil production hit its highest level for 2024 in November with a total of 1.7mb/d (+13.3% m/m) of crude oil and condensate output. In other news, Exxon has unveiled plans to increase spending to $28-$33 billion annually with a goal of lifting oil and gas output by 18% by 2030. Furthermore, Exxon aims to triple its production in the Permian Basin to 2.3mb/d by 2030 and pump 1.3mb/d in Guyana, as per Reuters. Finally, At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.36/bbl and $1.45/bbl, respectively.
After trading comfortably around $72.50/bbl overnight, the Feb’25 Brent futures contract has increased to $72.85/bbl this morning at 10:45 GMT (time of writing). Crude oil prices have been supported following the announcement of China’s looser monetary policy stance and expectations of a US Fed rate cut next week. In the news today, the Biden administration is considering harsher sanctions against Russian oil in the leadup to Donald Trump’s inauguration in January 2025. The sanctions could target Russian oil exports according to anonymous sources familiar with the matter, however, no exact details have been specified, as per Bloomberg. In other news, Russian crude oil flows through the Druzhba pipeline to the Czech Republic have continued as normal, operator MERO said following Ukrainian strikes on an oil depot in Russia’s Bryansk region last night, according to Reuters. Finally, Ecuador’s imports of refined products have been rising amid low refinery utilisation rates, with refining throughput for 2024 expected to drop 13.4% in 2024 y/y, as per S&P Global. Ecuador’s oil products imports were recorded at 4.1mb in September, 5mb for October, and 5.2mb in November. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.33/bbl and $1.27/bbl, respectively.
There was a battle for the barrels in the North Sea, with Totsa and Trafigura buying heavily and Equinor and Gunvor on the sell side. We have seen this same group of players swaying the flow in the Dated market for a few weeks now. The comparable power in the buying and selling has allowed for the Dated physical differential to move very little. The diff has been oscillating around 100c/bbl for almost a month now, failing to maintain anything 10c above or below a dollar since mid-November.
The Jan’25 RBOB futures contract weakened from an intraday high of nearly $2.05/gal on 22 Nov to $1.90/gal on 06 Dec. The contract found support here and climbed to $1.96/gal on 10 Dec (at the time of writing). The Feb’25 RBBR (RBOB vs Brent futures) rallied from $8.96/bbl on 02 Dec to $10.40/bbl at the time of writing. This week’s strength likely emerged amid a return of liquidity following Thanksgiving, with more risk put into summer positions alongside a weaker crude complex…
The Feb’25 Brent futures contract saw strength this afternoon, increasing from $71.80/bbl at 12:00 GMT up to a touch above $72.50/bbl at 17:50 GMT (time of writing). In the news today, Equinor stated that the start-up of their Johan Castberg oilfield in the Arctic has been postponed to January or February 2025 due to poor weather conditions. Johan Castberg, located in the Barents Sea, holds estimated recoverable volumes of 450mb to 650mb of crude oil and will be able to produce 220kb/d at its peak, according to Equinor. In other news, China National Petroleum Corporation (CNPC) said that Chinese oil demand could peak at 770 million metric tons as early as 2025 owing to the adoption of EVs and LNG trucks. This time last year, CNPC expected a peak of between 780-800 million metric tons in oil demand coming to China by 2030. Finally, Chevron has completed upgrades to its refinery in Pasadena, Texas, which is expected to increase processing capacity of lighter crudes by nearly 15% to 125kb/d. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.32/bbl and $1.30/bbl, respectively.
Another week brings another selection of new trade ideas from Onyx Research, this time looking at trades in LPG and high sulphur fuel oil. Our weekly Onyx Alpha report presents speculative and hedging trades based on technical analysis and data-driven tradecraft methods on Onyx Commitment of Traders (COT) and Flux Financials data.
The Feb’25 Brent futures contract saw weakness this morning, trading from $71.85/bbl at 07:00 GMT up to $72.20/bbl at 09:00 GMT and falling to around $71.55/bbl at 11:00 GMT (time of writing). In the news today, Israeli airstrikes targeted Syrian military installations and airbases overnight, but denied its forces had advanced into Syria beyond a buffer zone at the border, as per Reuters. Meanwhile, Israeli Prime Minister Netanyahu took the witness stand for the first time in his long-running corruption trial, pleading not guilty to charges of bribery, fraud, and breach of trust. In Russia, Foreign Intelligence Chief Sergei Naryshkin said that Moscow was close to achieving its goals in Ukraine, with Russia holding what he said was the strategic initiative in all areas in the war, as per Reuters. In other news, Iraq has ended the year without finalising a deal with Kurdistan for exports of crude oil from the northern region. MP Jiay Timor from the Kurdistan Democratic Party stated that the delay stems from disagreements over the cost of oil extraction, with the Iraqi government initially estimating the cost at $6/bbl while “foreign companies” estimated the cost to be as high as $26/bbl, according to Shafaq News. Finally, China’s customs data showed oil imports rose to 11.81mb/d in November, the first increase seen in seven months. The total for the month was 48.5 million tons of crude, a 14.3% increase y/y. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.27/bbl and $1.13/bbl, respectively.
The Feb’25 Brent futures contract strengthened this afternoon, increasing from $71.90/bbl at 12:00 GMT up to $72.65/bbl shortly after 15:40 GMT, before falling to $72.35/bbl at 17:55 GMT (time of writing). Crude oil prices were supported this afternoon with news of supply disruption in Syria alongside China’s easing monetary policy stance aiding bullish sentiment. In the news today, a tanker carrying Iranian oil to Syria turned around in the Red Sea after the fall of Syrian President Bashar al-Assad. Syria has not exported oil since late 2011, when international sanctions came in force, and is reliant on fuel imports from Iran, according to Reuters. In other news, an explosion and fire at a fuel depot owned by energy major Eni near Florence, Italy, killed at least two people and injured nine. The depot receives, stores, and ships out gasoline, diesel, and jet fuel, connected to a refinery in Livorno via two pipelines also operated by Eni. At present, the explosion and fire have not affected storage tanks, according to Eni. Finally, Israeli Foreign Minister Gideon Saar said that Israel is now more optimistic about a possible hostage deal in Gaza, with indirect negotiations under way about the return of 100 hostages, as per Reuters. Foreign Minister Saar has stipulated “there will not be a ceasefire in Gaza without a hostage deal”. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.31/bbl and $1.17/bbl, respectively.
