- Oil heads for its largest weekly loss in six months as macro-economic concerns counter tight supply
- November ’23 WTI gains 12c this morning to trade around $82.41/Bbl
- Brent crude and WTI fell by nearly $11.33/Bbl and $8.50/Bbl this week, exacerbated by a potentially overstated EIA report on weak U.S. gasoline demand
- The decline also coincides with the recent bond market selloff, leading to a stronger U.S. dollar and concerns about a slowing economy
- In September, nonfarm payrolls increased by 336,000, surpassing the expected 170,000 gain, while the unemployment rate stayed at 3.8% despite forecasts of a drop to 3.7%
- Strong job growth and stable unemployment rates often signal higher oil prices due to increased demand in a healthy economy
- However, Central bank measures to counteract inflation could weigh on this outlook
- Keystone oil pipeline that carries oil from Alberta to U.S. Midwest and onward to the U.S. Gulf Coast is running at 0.5 MMBbl/d, close to its 0.6 MMBbl/d capacity (Woodmac)
- Russia lifts ban on most diesel exports with new terms (Bloomberg)
- Russia resumes seaborne diesel exports weeks after an export ban due to a domestic fuel price surge that disrupted global markets; shipments now require delivery to ports via pipeline
- The export ban that started on Sept 21 led to a spike in European prices, and the new regulations will release about 90% of the pre-ban volumes, roughly 0.63 MMBbl/d, says Viktor Katona of Kpler
- The new terms stipulate producers must still retain 50% of their diesel production domestically
- Additionally, exporters that ship domestically bought diesel will incur a $500/ton export duty, while the government fully subsidizes refiners to offset price differences between local and international markets