In the week ending 02 Sep, M1 Brent futures rose to 1-month highs of $69.50/bbl. However, the $70/bbl resistance proved too great a hurdle, and prices subsequently weakened later in the week.
Continued Ukrainian attacks on Russian energy infrastructure, including refineries, supported the upside in price action. In August, Russia’s crude processing runs fell to their lowest since May 2022.
Combining the crude benchmarks (Brent + WTI), money managers added length (+6%) for the second consecutive week and trimmed their shorts (-5%) for the first time in four weeks. The long:short ratio was supported up from 1.93:1.00 to 2.15:1.00 (9th percentile for all weeks since 2013).
From a relative value perspective, WTI/Brent spreads continue to widen, with Oct’25 swaps falling below -$3.70/bbl amid continued bearish speculative sentiment in WTI.
