Happy Friday, Oil Watchers!
Every week, I summarize and analyze developments in flat crude prices, calendar spreads, high-frequency inventories, refined products, and positioning data, as well as a taste of the themes I’ve been thinking about or following closely—including our ongoing tracking of shipping flows throughout the Middle East.
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Summary
Flat Prices rose more than $5/bbl for Brent crude to end the week in the mid-$90s, the highest level in a month, as the US-Iran MOU formally expired with no diplomatic replacement and both sides ratcheted up the rhetorical temperature.
Timespreads were notably split across the major crude benchmarks: Brent saw prompt timespreads and DFLs trade sideways-to-slightly lower, WTI spreads had been weakest but rallied hard ahead of contract expiry, and Dubai spreads are tightest as more Red Sea crude gets pushed north by the Houthi naval blockade into the Mediterranean.
Inventories data leaned bearish—at the headline level—thanks to large inflows of US commercial crude and NGL stocks, though diesel inventories continued to draw to the lowest level for this time of year since 1996; an ARA European build and Singaporean draw offset each other.
Refined Products continue to rally as gasoline looks to end driving season sporting all-time high seasonally-adjusted crack spreads and diesel refining margins have reached the highest level on record on a trailing 10-day average basis.
Market Positioning data revealed that speculators were only modest net buyers of crude, which lessens concerns expressed last week that there was too much froth coming alongside recent price gains.
As Well As digging into the diesel disaster and yet more colour on the ongoing debate about how much oil is really getting out of the Middle East right now.