Oil Context Weekly (W49)
Oil Context Weekly (W49)
Crude prices shed another $3/bbl to mark their seventh consecutive weekly decline, the longest weekly losing streak in more than half a decade on continued speculative selling pressure.
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Summary
Flat Prices fell more than $3/bbl to end the week around $76/bbl Brent, closing out the seventh week of losses and maintaining the longest weekly loss streak since in more than half a decade.
Futures Curves are slipping into deeper contango, with prompt contango now evident across the front of both the WTI and Brent curves.
Inventories data leaned bullish with modest draws seen across all major hubs, with the most important single data point being US crude stocks, which drew by 4.6 MMbbl last week after six consecutive weeks of builds.
Refined Products crack spreads were reasonably flat; diesel sits around $33/bbl—still high by historical standards but down ~40% over the past three months—and gasoline continues to hang around the $10/bbl level.
Investor Positioning data revealed that speculators were once again sellers of crude contracts, with their nominal net position sinking to the lowest level since the initial COVID rout in early 2020; needless to say, while speculators clearly have maintained their bearish bias, with positioning overstretched this far to the downside it is only a matter of time before exaggerated short positions are forced to cover, resulting in—quite likely aggressive—upside price pressure on the barrel.
As Well As a telling Bloomberg interview with the Saudi Energy Minister, mounting Venezuelan belligerence towards neighbouring Guyana, and the first crude delivery to Nigeria’s ever-delayed Dangote refinery.