Good morning all. Brent futures were down 2 cents, or 0.1%, to $44.33 a barrel by 3:16 am GMT, while WTI futures slipped 2 cents, or 0.1%, to $42.32 a barrel.
With the markets moving into a soft contango and the front-month struggling to breakout topside even as broader risk market stabilize, traders have been reducing extended long position risk waiting for more precise signals on the OPEC+ catch up adjustment effects; the market hasn’t turned bearish it is just not as bullish, according to Stephen Innes, chief global markets strategist at AxiCorp.
On August 19 an OPEC+ monitoring committee had given non-compliant members until August 28 to submit plans to make their surplus production whole. OPEC+ members that had exceeded their production quotas in May, June and July will have to cut a combined 2.31 million b/d extra as compensation by the end of September. Notably, Iraq and Nigeria were the two biggest laggards, overproducing by 851,000 b/d over the three months, while Nigeria was over its limit by 315,000 b/d.
Furthermore, a ceasefire announced by Libya’s Turkish-backed government with the Libya National Army could see the country’s National Oil Corp resuming exports at a time when the OPEC +alliance is tapering production cuts.
Meanwhile, an upcoming symposium later this week could give clues to the US Federal Reserve’s next move. As the latest moves from the Fed which has strengthened the US dollar with less than positive effects on oil prices, the market will be looking closely for cues at Jackson Hole symposium into the latter half of the week.
On another note, two storms heading into the US Gulf Coast could put a pause in the country’s oil activity at a time when US drillers have increased the number of new oil rigs for the first time since March. According to Reuters, producers had shut 58% of the Gulf’s offshore oil output on Sunday. The region accounts for 17% of total U.S. oil production.
According to Bloomberg, Chinese refiners have imports of diluted bitumen possibly in a sign of either their desperation to produce fuel and asphalt for a rebounding economy, or that they’re avoiding local import quotas.
MARKETS NEWS:
* Gulf Coast of U.S. Facing Double Hammer Blow From Hurricanes
* More Than Half of Gulf of Mexico Oil Output Shut Ahead of Storms
* China’s Bitumen Import Boom Has Traders Smelling Venezuelan Oil
* Nigeria’s NNPC Oil and Gas Sales Rebound in June: This Day
* Permian Oil Drillers Bounce Back with Biggest Rig Hike This Year
* ASIA-AMERICAS FUEL: Jet Fuel Boosts Aug. Flows to a 4-Month High
* Saudi Aramco Suspends $10 Billion China Oil Refinery Venture
OTHER NEWS:
* Corn And Crude to Help Tally China’s Trade Deal Progress
* Gas Pipeline Blast Near Damascus Cuts Power Across Syria
PHYSICAL CRUDE NEWS:
* ASIA: Banyu Urip Offered; Banks Cut Funds to MENA Energy
* LATAM: YPF Plans 45-Day La Plata Work; Maria Ines Tender
* US/CANADA: Pipe Explosion Partly Shuts Texas Oil Port
* NSEA: Equinor Sells Oseberg; Litasco, Vitol Bid Forties
* MED: Urals Loadings to Rise in Early Sept.; Libya Exports
* WAF: Sonangol September Spot Sales; Nigerian Oct. Exports
OIL PRODUCT NEWS:
* EUROPE: Flow From Mideast Drops; BP Sells ULSD
* ASIA: Trafigura Hires VLCCs for Fuel; BPCL Diesel
* U.S.: Twin Caribbean Storms, Corpus Christi Fire
ECONOMIC EVENTS:
* One, or possibly two, tropical storms are likely to be moving through the Gulf of Mexico during Monday, potentially causing companies to evacuate offshore rigs and platforms
ANALYST COLUMNS:
* A Small Spill on a Remote Island Is Bad News for Oil: Julian Lee
OTHER FINANCIAL MARKETS:
* Hong Kong Stocks Lead Asia Higher; Dollar Slips: Markets Wrap
Singapore 380 INDIC
Sep20 262.75 / 264.75
Oct20 260.75 / 262.75
Nov20 260.00 / 262.00
Dec20 260.25 / 262.25
Jan21 261.75 / 263.75
Feb21 263.50 / 265.50
Q4-20 260.25 / 262.25
Q1-21 263.50 / 265.50
Q2-21 268.75 / 270.75
Q3-21 273.00 / 276.00
CAL21 267.00 / 273.00
Rotterdam 3.5% INDIC
Sep20 249.75 / 251.75
Oct20 246.25 / 248.25
Nov20 244.50 / 246.50
Dec20 244.00 / 246.00
Jan21 245.50 / 247.50
Feb21 247.00 / 249.00
Q4-20 244.75 / 246.75
Q1-21 247.00 / 249.00
Q2-21 251.50 / 253.50
Q3-21 254.50 / 257.50
CAL21 250.50 / 256.50
Singapore VLSFO 0.5% INDIC
Sep20 323.00 / 328.00
Oct20 325.75 / 330.75
Nov20 328.50 / 333.50
Dec20 331.25 / 336.25
Jan21 334.75 / 339.75
Feb21 338.00 / 343.00
Q4-20 328.50 / 333.50
Q1-21 338.00 / 343.00
Q2-21 346.00 / 352.00
Q3-21 353.25 / 359.25
CAL21 349.00 / 355.00
Rott VLSFO 0.5% INDIC
Sep20 302.25 / 307.25
Oct20 305.75 / 310.75
Nov20 309.25 / 314.25
Dec20 312.75 / 317.75
Jan21 316.75 / 321.75
Feb21 320.50 / 325.50
Q4-20 309.25 / 314.25
Q1-21 320.50 / 325.50
Q2-21 329.25 / 335.25
Q3-21 336.75 / 342.75
CAL21 332.00 / 338.00
Sing 10ppm GO INDIC
Sep20 49.03 / 49.17
Oct20 49.48 / 49.68
Nov20 49.94 / 50.14
Dec20 50.44 / 50.64
Jan21 51.00 / 51.20
Feb21 51.57 / 51.77
Q4-20 49.90 / 50.20
Q1-21 51.51 / 51.81
Q2-21 53.07 / 53.37
Q3-21 54.36 / 54.66
CAL21 53.45 / 53.85
ICE Gasoil 10ppm INDIC
Sep20 370.04 / 372.04
Oct20 375.29 / 377.29
Nov20 378.99 / 380.99
Dec20 383.36 / 385.36
Jan21 387.82 / 389.82
Feb21 392.40 / 394.40
Q4-20 379.20 / 381.20
Q1-21 392.21 / 394.21
Q2-21 401.69 / 403.69
Q3-21 411.46 / 413.46
CAL21 405.54 / 407.54
Rott Hi5 Sing Hi5
Sep20 54 62
Oct20 61 67
Nov20 66 70
Dec20 70 73
Jan21 73 75
Feb21 75 76
Q4-20 66 70
Q1-21 75 76
Q2-21 80 79
Q3-21 84 82
CAL21 82 82