- Oil trades higher amid the weakening U.S. Dollar and Kurdish supply risks
- May ’23 WTI gained 69c this morning to trade around $73.66/Bbl
- Exports from the semi-autonomous Kurdistan region of northern Iraq remain halted and are unlikely to resume this week (BBG)
- Companies operating oilfields in Kurdistan have reduced or shut in output due to a halt in the northern export pipeline, with further outages expected
- A strong rally in equities continues to subside worries regarding banking failures, as the FDIC may ask larger banks to cover $23 billion in costs from bank failures
- The U.S. Dollar continues to weaken relative to its recent highs, making oil more affordable for holders of other currencies
- French government releases 10 MMBbl of fuel from strategic reserves as ongoing strikes continue to affect refinery and port operation (BBG)
- Additionally, OPEC+ will reportedly uphold current oil output cuts at their upcoming meeting as oil recovers from a 15-month low, according to the bloc’s delegates (Reuters)
- Western insurance continues to complicate Russia's oil export shift to Asia (BBG)
- The insurance of over 50% of Russia's crude shipments by Western countries is hindering its efforts to increase oil exports to China and India
- The $60/Bbl price cap set by the EU and the U.S., which is enforced by Western insurance, is concerning Russian oil industry officials as further reductions in price caps may result in significant revenue losses
- The world's most important oil price benchmark, Dated Brent, is being overhauled as it runs out of tradable oil (BBG)
- The shift will allow oil from West Texas (WTI Midland) to determine the price of millions of barrels of petroleum transactions
- Platts will evaluate current Dated grades and use a freight adjustment factor to determine the market price, with crude cargoes from the U.S. allowed for inclusion from early May