- Oil retreats from April peak as market weighs tight supply with further rate hikes
- September ’23 WTI lost 73c this morning to trade around $82.09/Bbl
- Equities trade lower, while the dollar weakened relative to its recent highs
- Government bond selloffs intensified Monday due to concerns over potential interest rate hikes. The 30-year German bond yield hit its highest since early 2014, and similar US yields also rose
- While exports are continuing, Ukrainian drone attacks near Russia’s Black Sea ports highlight the threat to crude and product exports
- Additionally, Poland halted oil shipments to Germany via the Druzhba pipeline after finding a leak Saturday. Flows should resume Tuesday
- Black Sea drone strikes threaten Russian crude exports (Bloomberg)
- Ukrainian drone attacks on a Russian naval vessel and an oil tanker in the Black Sea over the weekend endangered Russia's commodity exports, including 15-20% of its daily global oil sales
- Russia's Novorossiysk port, a major oil export hub, faces potential disruptions affecting up to 2.5 MMBbl/d of crude and product exports
- Kpler expects that freight rates across the Black Sea could "balloon," with the cost of shipping Russian crude potentially increasing by as much as 50% due to the escalated risk
- Saudi oil prices to Asia indicate uneven recovery across crude markets (Bloomberg)
- Saudi Arabia's oil pricing shows higher-density crudes outperforming lighter grades; heavier crudes for Asian clients in September rise by up to 70c, almost double the increase for Arab Light crude (+30c)
- Price rises in heavier oil blends may be due to tighter global supply from Saudi cuts and reduced Russian exports, along with improved Asian refining margins favoring diesel and fuel oil
- Arab Extra Light crude's price remains unchanged, possibly due to increased U.S. exports to Asia
- According to traders, lighter crudes remain well-supplied, particularly in the Atlantic Basin