- Oil trades below $85/Bbl amid macro-economic concerns and possible demand weakness
- November ’23 WTI lost 67c this morning to trade around $83.55/Bbl
- Prompt month WTI fell over $5/Bbl yesterday, the largest one-day plunge since August 2022, on the backdrop of a strong dollar and concerns about interest rates staying higher for longer
- Additionally, Turkey's energy minister announced today that the Iraq-Turkey pipeline was ready to operate "as of yesterday — Wednesday," but the restart of crude flows hinges on Iraq (Argus)
- The pipeline, transporting 0.4 MMBbl/d from the Kurdistan and 0.07 MMBbl/d of federal Iraqi crude, has been shut since March 25
- Keystone pipeline restarts at reduced output (Bloomberg)
- After maintenance on Tuesday, the Keystone crude pipeline is operating at 50% capacity, carrying 0.3 MMBbl/d of crude
- The disruption sees Canadian heavy crude's price discount in Alberta to WTI widening 90c to $20.65/Bbl, a level not observed since February
- US gasoline demand plunges, posing new hurdle for oil (Bloomberg)
- On Wednesday, the EIA data showed that the four-week average implied fuel consumption dropped to 8.3 MMBbl/d last week, the lowest seasonal rate since 1998
- This morning, front gasoline cracks bounced back from yesterday's decline, trading over $1/Bbl above the overnight lows
- Inventories rose by 6.5 MMBbl/d last week, while exports saw a small uptick and imports were down slightly
- AEGIS believes that the implied demand calculations, influenced by factors like production, imports, and especially recent storage figures, might be overstated
- Furthermore, Goldman, in a note to clients this morning, highlights alternate data points, such as ethanol blending and physical price findings, to suggest that demand is still robust