Good morning all. Brent futures for October, set to expire on Friday, rose 2 cents to $45.11 a barrel at 4:09 am GMT. The November contract climbed 3 cents to $45.63. WTI futures were down 3 cents, or 0.1%, to $43.01 a barrel.
Hurricane Laura, a Category 4 storm, made landfall along the USGC early Aug. 27. Two major refineries near Lake Charles, Louisiana, were most directly in the path of the hurricane and seem to have been the worst hit. Citgo’s 418,000 b/d refinery could be shut for 4-6 weeks in order to repair the damage, and there is little detail on when Phillips 66’s refinery will restart.
Still, minimal damages are expected for other refineries and energy infrastructures in the area, with most of them shut expected to return once power is restored, according to the US Secretary of Energy Dan Brouillette.
The Gulf of Mexico shut-in production is also expected to return within days as impairments were thought to be better than expected.
On the other hand, refining margins have plummeted as flash floods are disrupting normal consumption patterns, likely for a longer period of time than production remains offline.
On the supply side, rising OPEC+ supply continues to be a key concern on traders’ minds, especially as global demand recovery appears to be plateauing.
OPEC+ production cuts of 7.7 million b/d are expected to run from August to the end of 2020, before tapering into a lower 5.8 million b/d from January 2021. However, members’ failures to adhere to production quotas have been a significant concern for the global crude complex.
The 23-country OPEC+ coalition exceeded its quotas by 357,000 b/d from May to July, and members that exceeded their production quotas in May, June and July were expected to cut a combined extra 2.31 million b/d as compensation by the end of September.
Furthermore, oil prices are expected to suffer from reports that UAE plans to exceed its OPEC+ quota by 900,000 b/d in October.
Elsewhere, Bloomberg analysts expect in China a small boost in energy demand from infrastructure projects and post-flood recovery efforts.
MARKETS NEWS:
* Iraq’s Kurds Say They Cut Oil Output to Help Baghdad Comply
* Russia Refiners Idle More Capacity Offline Than Usual for August
* Putin Says Oil Prices Above $46/Bbl Would Be Better
* U.K. Road Fuel Sales Edge Higher, Briefly Top Pre-Lockdown Level
* North Sea Forties Crude Loadings to Rise to 15 Cargoes in Oct.
* PADD 1 Gasoline Imports Set to Dip in Coming Week: Vortexa
* Transatlantic Clean Tanker Rates Drop After Laura Makes Landfall
* Gabon to Ship 62K B/d of Rabi Light and Oguendjo Crudes in Oct.
HURRICANE LAURA:
* Laura Sows Fires, Flooding, Wreckage in Wake: Hurricane Update
* Blackouts, Shorn Roofs and a Chemical Fire: Laura’s Devastation
* Phillips 66 Lake Charles Assessment May Be Hampered by Chem Fire
* Exxon Mobil: Beaumont Refinery, Plants Remain Safely Shutdown
* Motiva Port Arthur Expects to Run Normally Within A Week
* Citgo Refinery Damaged by Laura May Be Shut for 4-6 Weeks
* Restarting Chemical Plants After Laura Means Enormous Gas Leaks
OTHER NEWS:
* Alberta Says Deficit Will Triple on Virus Shock, Low Oil Prices
* Nigeria’s Buhari Names Interim Head for Oil Region Amnesty
* BP to Close Naperville Business Center With Loss of 280 Jobs
* Petrobras to Sell $1.67 Billion Stake in Fuel Distributor
* What to Watch in Commodities: OPEC, Oil, Iron Ore, Corn, La Nina
PHYSICAL CRUDE NEWS:
* ASIA: Malaysian Oil Sold at Discount; Laura Makes Landfall
* LATAM: Argentina Resumes San Sebastian Exports; Pemex
* US/CANADA: Storm-Hit Citgo Refinery Seen Shut for Weeks
* NSEA: Forties, Brent Loadings to Rise; Ekofisk to Fall
* MED: Surgut Offers More Urals; Hellenic Buys CPC From TCO
* WAF: Mercuria Buys From Unipec; Eq. Guinea, Gabon Exports
OIL PRODUCT NEWS:
* U.S.: Fire in Way of Phillips 66 Checking Damage
* ASIA: Singapore Stockpiles Decline; Indian Fuels
* EUROPE: U.S. Pull on Gasoline; Pembroke CDU Halts
ECONOMIC EVENTS: (Times are London. )
* 6:30pm: ICE Commitments of Traders report
* 7pm: Baker Hughes weekly rig count report
* 8:30pm: CFTC Commitments of Traders report
ANALYST COLUMNS:
* Oil Market Deficits Set to Swell Going Into 4Q, DNB Say
* Gasoil Stockpiles Rise in Europe’s ARA Region: Insights Global
* Fuel Oil Stockpiles in ARA Hub Fall to Pre-Lockdown Levels: IG
OTHER FINANCIAL MARKETS:
* Bonds Drop After Powell; Stocks, Futures Advance: Markets Wrap
Singapore 380 INDIC
Sep20 267.50 / 269.50
Oct20 266.00 / 268.00
Nov20 265.75 / 267.75
Dec20 266.00 / 268.00
Jan21 267.50 / 269.50
Feb21 269.25 / 271.25
Q4-20 266.00 / 268.00
Q1-21 269.25 / 271.25
Q2-21 274.00 / 276.00
Q3-21 277.75 / 280.75
CAL21 269.00 / 275.00
Rotterdam 3.5% INDIC
Sep20 255.25 / 257.25
Oct20 251.75 / 253.75
Nov20 249.75 / 251.75
Dec20 249.25 / 251.25
Jan21 250.75 / 252.75
Feb21 252.25 / 254.25
Q4-20 250.25 / 252.25
Q1-21 252.25 / 254.25
Q2-21 256.00 / 258.00
Q3-21 258.75 / 261.75
CAL21 251.50 / 257.50
Singapore VLSFO 0.5% INDIC
Sep20 324.50 / 329.50
Oct20 327.25 / 332.25
Nov20 329.75 / 334.75
Dec20 332.25 / 337.25
Jan21 335.00 / 340.00
Feb21 337.75 / 342.75
Q4-20 329.75 / 334.75
Q1-21 337.75 / 342.75
Q2-21 346.25 / 352.25
Q3-21 354.75 / 360.75
CAL21 350.25 / 356.25
Rott VLSFO 0.5% INDIC
Sep20 301.75 / 306.75
Oct20 304.50 / 309.50
Nov20 307.00 / 312.00
Dec20 309.50 / 314.50
Jan21 313.25 / 318.25
Feb21 317.00 / 322.00
Q4-20 307.00 / 312.00
Q1-21 316.75 / 321.75
Q2-21 324.75 / 330.75
Q3-21 330.75 / 336.75
CAL21 326.75 / 332.75
Sing 10ppm GO INDIC
Sep20 48.92 / 49.06
Oct20 49.39 / 49.59
Nov20 49.82 / 50.02
Dec20 50.29 / 50.49
Jan21 50.88 / 51.08
Feb21 51.44 / 51.64
Q4-20 49.85 / 50.05
Q1-21 51.45 / 51.65
Q2-21 53.03 / 53.23
Q3-21 54.32 / 54.52
CAL21 53.36 / 53.76
ICE Gasoil 10ppm INDIC
Sep20 367.26 / 369.26
Oct20 373.13 / 375.13
Nov20 377.99 / 379.99
Dec20 382.50 / 384.50
Jan21 387.30 / 389.30
Feb21 392.07 / 394.07
Q4-20 377.85 / 379.85
Q1-21 391.68 / 393.68
Q2-21 401.11 / 403.11
Q3-21 412.26 / 414.26
CAL21 405.68 / 407.68
Rott Hi5 Sing Hi5
Sep20 46.86 57.36
Oct20 53.36 61.61
Nov20 58.36 64.36
Dec20 61.86 66.86
Jan21 64.11 68.11
Feb21 65.86 69.11
Q4-20 57.85 64.30
Q1-21 65.86 69.19
Q2-21 72.61 74.86
Q3-21 75.36 77.86
CAL21 77.00 77.00