SPR release in the void ?

Crude prices remained pressured, sticking to the 80-82 $/b range, as the possibility of a US SPR release limited prompt tightness. With such growing political pressure and uncertainty, money managers continued to cut their exposure to major futures markets (Brent, WTI). The Brent open interest from financial players declined by 94k since this summer when the reflation trade narrative remained intact. The Biden administration may release stocks imminently, which would be at odds with previous releases, where a supply disruption needed to be identified for activating such release. Furthermore, Biden’s view that petroleum markets could cope with Iranian crude being off the market added another layer of fogginess to the US energy policy. The fact that outright crude prices are stagnating below 85 $/b is also a deterrent for the administration to act.

energyscan oil news

On the Chinese side, refiners processed more crude in October, at 13.64 mb/d. Yet, it remains markedly below its peak in June 2021, at 14.6 mb/d. There is evidence that refining runs will continue to strengthen. Sinopec and PetroChina both mentioned their ramp-up in diesel output by close to 20%, amid rising domestic prices and improving margins. Shandong independent refiners were also raising their outputs compared to October, closer to a 73% utilization rate.

Share this news :

You might also read :

ES-economy
April 13, 2021

US inflation data today

No big thing yesterday on financial markets but a gradual increase in bond yields that seems to reflect caution ahead of key economic reports in…
ES-oil
May 31, 2021

Final week for Iranian talks

ICE Brent prompt prices traded at 69.1 $/b on early Monday, after a strong expiry for ICE Brent contracts. Crude stocks globally are dipping at…
ES-gas
May 11, 2021

Strong price rise on the spot and the curve

European spot gas prices increased strongly yesterday, supported by higher gas demand due to the drop in temperatures below normal and lower wind power generation.…
Join EnergyScan

Get more analysis and data with our Premium subscription

Ask for a free trial here

🏆 You like our solution ?

Vote for us at the 2024 Energy Risk Commodity Rankings, in the Research category!

Thanks in advance.

Don’t have an account yet? 

[booked-calendar]