The Official Reports

Ennui is such a good word to describe the feeling sparked by the dated Brent market. Finally, things start to calm down and go into a reasonable direction where weakness or strength is reflected across all instruments. Equinor continues to increase the profile of Johan Sverdrup like they have bigger plans for the crude stream and sold a cargo loading Oct 1-3 to BP at Dated flat. A boring price but we like boring.

Ennui is such a good word to describe the feeling sparked by the dated Brent market. Finally, things start to calm down and go into a reasonable direction where weakness or strength is reflected across all instruments. Equinor continues to increase the profile of Johan Sverdrup like they have bigger plans for the crude stream and sold a cargo loading Oct 1-3 to BP at Dated flat. A boring price but we like boring.

Dubai’s physical premium has averaged $2.01/bbl so far in September, compared to the 90c in the full month of August. On a flat price basis, the market flatlined today. There’s still a lot of danger for the longs if the right noises are not made by OPEC and friends. OPEC’s life support isn’t working, with Dubai partials gaining 2c and front-month Brent futures losing the same, down at near 14-month lows. Despite some chaotic news announcements about OPEC quotas, Kennie and other long trades have never woken up from their comatose state.

Bad macros finally killed those with narrow focus on supply disruption stories in the face of continuing
loadings and also those believing fantastic stories of demand growth in the 2 mil bbl range.
Hello, wake up everybody; the world economy is soft and you know it, you read it everyday, you see it, you
feel it. You just want to believe your own story or that being fed by producers. What do you expect? That a
producer or group of producers, or long traders are going to tell you the demand growth isn’t there?

Dubai’s surge relative to Brent marches onward. Dubai partials minus front month Brent futures inverted,
going positive for the first time since 10 July, at 9c by the close of Asia today, while on a physical premium
basis, Dubai remains elevated at 2 bucks. While Brent futures spreads and CFDs get hammered in Europe,
Dubai’s prompt structure remains strong, and Dubai continues to outperform. The window was quiet, and
traders were tentative following the overall downward flat price correction. But Vitol and Mets still picked up
some partials from PC and Exxon. Anybody with a sense of end-user demand should sell, of course.

We said yesterday that the market really wanted to go up, regardless of fundamentals. Seems like bulls were too attached to Libya or to some fluffy nonsense as Libyans really need the money and so they’ll find a way to accommodate and keep the cash flowing. Remember technicals are noise but macros always win in the end and macros are super bearish – we say this with in situ reporting from China.

Dubai surged relative to Brent, closing the spread. China is widely seen as underperforming but the weak
picture as we enter the fall is not translating into softer Asian benchmarks. Dubai is the outperformer so far in
September. The prompt weakness in the Dubai we saw throughout the back end of August has been left in
dust after expiration. Vitol continued to bid and are seen as winning with Dubai physical premia rising to over
two bucks in the first two trading days of September.

Boom! Brent flat price blazed a trail back up from the meagre sub $79/bbl handle it had been holding since yesterday evening to bound up to the $80/bbl level with a huge jump through the afternoon. But almost as quickly as it rose up, it got smacked back down again by almost 90c. According to a trader Brent “basically gapped down on nothing” and was “just following spreads”. The longs who took their winnings beforehand will be feeling pretty pleased with their afternoons and get a cosy night’s sleep on a big pillow of bank notes.

Boom! Brent flat price blazed a trail back up from the meagre sub $79/bbl handle it had been holding since yesterday evening to bound up to the $80/bbl level with a huge jump through the afternoon. But almost as quickly as it rose up, it got smacked back down again by almost 90c. According to a trader Brent “basically gapped down on nothing” and was “just following spreads”. The longs who took their winnings beforehand will be feeling pretty pleased with their afternoons and get a cosy night’s sleep on a big pillow of bank notes.

Boom! Brent flat price blazed a trail back up from the meagre sub $79/bbl handle it had been holding since yesterday evening to bound up to the $80/bbl level with a huge jump through the afternoon. But almost as quickly as it rose up, it got smacked back down again by almost 90c. According to a trader Brent “basically gapped down on nothing” and was “just following spreads”. The longs who took their winnings beforehand will be feeling pretty pleased with their afternoons and get a cosy night’s sleep on a big pillow of bank notes.

Boom! Brent flat price blazed a trail back up from the meagre sub $79/bbl handle it had been holding since yesterday evening to bound up to the $80/bbl level with a huge jump through the afternoon. But almost as quickly as it rose up, it got smacked back down again by almost 90c. According to a trader Brent “basically gapped down on nothing” and was “just following spreads”. The longs who took their winnings beforehand will be feeling pretty pleased with their afternoons and get a cosy night’s sleep on a big pillow of bank notes.

Boom! Brent flat price blazed a trail back up from the meagre sub $79/bbl handle it had been holding since yesterday evening to bound up to the $80/bbl level with a huge jump through the afternoon. But almost as quickly as it rose up, it got smacked back down again by almost 90c. According to a trader Brent “basically gapped down on nothing” and was “just following spreads”. The longs who took their winnings beforehand will be feeling pretty pleased with their afternoons and get a cosy night’s sleep on a big pillow of bank notes.

Yesterday Vatman and Gobin were firmly in control but today the story was different. Almost all of the Dubai
Duo’s hard work yesterday was erased at the close of Asia on a premium basis. Relative to other benchmark
grades, Dubai got slammed, with October Brent futures premium over Dubai physical cargoes widening by
88c to $1.79. On a physical premium basis, compared to yesterday, the longs were hammered, with Dubai
partials premium minus Oct swaps falling by almost 50c to $1.17. It lost almost all it gained yesterday.

The sucker went down. We are talking about the flat price, as Brent flat price shed almost $2.50/bbl against yesterday. But in Dubai is a completely different story. The longs are winning on a premium basis.

27 August 2024: 16:30 BST Having surged upwards yesterday morning on the weekend’s bullish geopolitical news, Brent stagnated around the $81/bbl mark today before sliding to around $79.60/bbl by 18:00 BST in a sell-off after market close. “They’re keeping the