- Oil reverses some of last week’s losses amid the risk of supply shortfalls
- March ’23 gained nearly 45c this morning to trade around $74/Bbl
- Prices were supported after pipeline flows to Turkey’s Ceyhan export terminal were halted due to an earthquake
- Optimism for a recovery in Chinese demand persists as the nation relaxes its strict Covid policies
- Over the weekend, IEA Director Fatih Birol said that China might see a stronger-than-expected recovery in demand
- Yesterday, the EU imposed sanctions on Russian oil products; the EU-G7 also agreed to impose a price cap on Russian products that is identical to the cap in place on Russian oil
- EU and G7 agreed to cap the price of Russian oil products that trade at a premium to crude at $100/Bbl and at a discount at $45/Bbl on Friday (Bloomberg)
- The cap went into effect on February 5, along with sanctions, and includes a grace period until April for shipments that were loaded before the cap was decided
- EU diplomats also agreed to delay the review of the $60/Bbl price cap for Russian crude oil until March. After that, they will begin regular two-month reviews of all cap levels
- Turkey halted crude pipeline supplies to its Ceyhan export terminal on the Mediterranean coast following an earthquake on February 5 (Bloomberg)
- The 7.7 magnitude earthquake, one of the strongest in the Middle East in recent years, damaged infrastructure and killed hundreds of people in Turkey and Syria
- In January, Ceyhan, a hub for oil sales from northern Iraq and Azerbaijan, exported more than 1 MMBbl/d, primarily to European refineries
- According to an official, there were no leaks found on the pipelines feeding the port