- Oil rose nearly 1.5% on Tuesday from a nine-month low a day earlier
- WTI reversed some of yesterday's losses as the U.S. Dollar weakened slightly relative to its recent 20-year highs
- Concerns about falling demand and a strong USD still weigh on crude prices
- President Biden reiterated his demands for oil companies to lower their costs on Monday, despite U.S. gasoline prices declining from the highs witnessed this summer
- With crude prices easing last month, Biden said, "We haven't seen the lower prices reflected at the pump, though. Meanwhile, oil and gas companies are still making record profits."
- Meanwhile, the White House reaffirmed that it is closely monitoring global financial markets amid currency movements and increased volatility
- Russia's seaborne crude exports to Europe are being constrained, with E.U.'s sanctions only about two months away (BBG)
- Customers in northern Europe have cut their imports, which are currently below 0.300 MMBbl/d or roughly one-fourth of the volume that was imported into the region prior to the Russian invasion
- Meanwhile, the diversion of crude flows from Europe to Asia appears to have stalled
- Flows to China, India, and Turkey, the top three importers of Russian barrels, which first stepped in to fill the gap after European buyers started to shun Moscow's shipments, have been in decline since mid-August
- Combined shipments to these three countries fell by around 0.460 MMBbl/d in the four weeks to September 23 from the high seen five weeks earlier
- B.P. and Chevron announced that they had stopped production at offshore rigs in the region as Hurricane Ian approached the Gulf of Mexico on Monday (Reuters, BBG)
- The category two storm, which was in the Caribbean, is expected to strengthen into a major hurricane in two days
- B.P. reported that it had evacuated staff from its 0.250 MMBbl/d Thunder Horse facility and its 0.130 MMBbl/d Na Kika platform
- Chevron started evacuating all personnel and shutting-in production from its Petronius and Blind Faith facilities, which produce 90 MMcf/d of gas and about 0.105 MMBbl/d of oil
- The storm is the first this year to disrupt oil and gas production in the U.S. Gulf of Mexico, which produces 15% of the nation's crude oil and 5% of dry gas production
- While the hurricane is not expected to affect refinery capacity along the Texas and Louisiana coasts, it could cause more oil and gas production in the Eastern Gulf of Mexico to be shut down later this week
- Goldman Sachs cut its oil price forecasts in response to growing indications of a global economic slowdown (BBG)
- The bank cuts Brent's 4Q22 forecast to $100/Bbl from $125/Bbl
- The market is still "critically tight," and crude prices are likely to rise from present levels, said a note on Tuesday
- "A strong U.S. dollar and falling demand expectations will remain powerful headwinds to prices into year-end," said Goldman analysts Damien Courvalin and Callum Bruce