Fuel Oil

Fuel oil is a vital energy source used primarily in industrial settings, shipping, and power generation, contributing to essential sectors of the global economy.

Find live prices on Flux Terminal. Trade fuel oil cost-free on Onyx Markets.

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European Window: Brent Drops to $68.70/bbl

The Sep’25 Brent Futures contract rallied from $68.88/bbl to $69.49/bbl at 17:11 BST. Prices dropped to $68.70/bbl at 17:33 BST (time of writing). In the news, Chevron is regaining permission from the Trump administration to resume oil production in Venezuela, according to WSJ. The agreement comes shortly after a prisoner swap that freed the last 10 Americans held by the Venezuelan government. Chevron confirmed it would continue to operate in line with US laws and sanctions. Earlier this year, the Trump administration revoked Chevron’s license granted under President Biden. Venezuela’s production has stayed at around 900kb/d to 1 mb/d, with much of its crude rerouted through hubs like Malaysia to China despite US threats of tariffs on nations importing Venezuelan oil. In other news, Russia’s FSB has resumed approving foreign tankers to access Black Sea ports, allowing Kazakhstan’s oil exports to restart after a brief halt that disrupted about 2% of global supply and pushed oil prices near $70/bbl. The suspension followed new Russian regulations signed by President Putin after fresh EU sanctions over Ukraine. Kazakhstan’s exports through the Caspian Pipeline Consortium were briefly stopped, though plans for August shipments remain largely unchanged.  Russia is preparing to impose a stricter gasoline export ban that will also apply to fuel producers, aiming to curb rising domestic prices, according to industry sources. The measure would expand current restrictions that only cover resellers. Exemptions will apply to the Eurasian Economic Union and countries with specific fuel agreements, such as Mongolia. Russia has repeatedly used temporary export bans in recent years to prevent shortages and stabilize prices. Finally, the front-month Sep/Oct and 6-month Sep/Mar’26 spreads are at $0.76/bbl and $2.16/bbl respectively.

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Trader Meeting Notes

Trader Meeting Notes: $70/bbl? No, thank you!

Last week, we spoke about how it was difficult to hold Brent above $70/bbl, and absolutely nothing has changed. The M1 Brent futures contract moved from a high of $70.80/bbl on 18 Jul to closing sub-$70/bbl on the day and eased to a low of $68/bbl on 23 Jul. Prices met support here but remain at $68.90/bbl. Focus remains on refinery margins and middle distillate cracks. However, while gasoil cracks remain high, the M1 ICE LS gasoil crack has sold off from a high of $27.20/bbl to $24.35/bbl, raising concerns for the bullish trend driving middle distillates for over a month. US distillate fuel oil inventories built by 2.9mb in the week ending 18 Jul, but remain 18% below the 5-year average, which could continue to provide a floor to price action. However, a further sell-off would impact refinery margins, potentially affecting crude demand by refiners. Demand for refined fuel may be lifted by the US reaching trade deals with critical trading partners, such as the EU, providing much-needed respite to the global manufacturing industry. On this note, US business activity has picked up in July, as per S&P Global’s Composite PMI. However, companies asked for higher prices for goods and services, reinforcing the view that inflation would persist for the remaining half of the year and possibly fuelling the ongoing spat between US President Donald Trump and Fed Chair Jerome Powell.

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European Window: Brent Rallies to $68.53/bbl

The Sep’25 Brent Futures contract saw a volatile afternoon with prices bouncing between $68.47/bbl and $68.03/bbl. Prices then rallied to $68.53/bbl at 17:28 BST (time of writing). In the news, US crude oil inventories dropped by 3.2 mb to 419 mb in the week ending 18 July according to the EIA. The drawdown was supported by higher demand and exports, with crude exports rising to 3.86 mb/d and net imports falling by 740kb/d. Gasoline stocks fell by 1.7 mb to 231.1 mb, while gasoline demand rose to 8.97 mb/d, though still below typical summer levels. Refinery utilisation climbed to 95.5%, its highest since June 2023. Distillate inventories rose by 2.9 mb to 109.9 mb. In other news, Zinc contamination in the US offshore Mars crude stream has been resolved, with levels now back within expected limits, Chevron announced. The issue, traced to the startup of an offshore well earlier this month, had disrupted supplies to Gulf Coast refineries and prompted the US government to release crude from the Strategic Petroleum Reserve to stabilize operations. Chevron is collaborating with Shell to continue monitoring zinc levels in the pipeline system. Angola has boosted its declining oil output with the startup of two offshore projects adding a combined 60kb/d, according to the national oil agency ANPG. Both projects are part of Angola’s strategy to stabilize production, which has fallen by half since its 2008 peak of 2 mb/d. Finally, the front-month Sep/Oct and 6-month Sep/Mar’26 spreads are at $0.72/bbl and $1.99/bbl respectively.

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COT Report: Sentiment Turnaround

See all the updates across the barrel in this week’s Onyx Commitment of Traders report, as well as six contracts to watch. Click on the relevant button below to access your COT report.

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European Window: Brent Falls Below $69.00/bbl

The Sep’25 Brent Futures contract initially rallied to $69.02 at 13:34 BST before falling to $68.21 at 15:08. Prices have since slightly recovered to $68.33/bbl at 17:35 BST (time of writing). In the news, US Treasury Secretary Scott Bessent will meet with his Chinese counterpart in Stockholm next week to discuss a likely extension of 12 August deadline for a trade deal. Bessent described the current US-China trade relationship as “constructive,” highlighting recent progress including China ending its rare earth export ban and the US resuming key tech exports. Without a deal or extension, tariffs could revert to 145% on US goods and 125% on Chinese goods. In other news, Halliburton reported that declining crude production in Mexico is increasing pressure to revive business, but ongoing payment delays from state-run Pemex continue to hinder operations. Pemex’s crude and condensate output dropped 8.4% in May to 1.64 mb/d. Due to unresolved payment issues many oilfield service companies have scaled back activity. Halliburton expects its international revenue for 2025 to decline by mid-single digits, largely due to reduced activity in Mexico and Saudi Arabia. Russia’s oil and gas revenue is projected to drop by about 37% y/y in July 2025 to 680 Bn roubles, due to lower oil prices and a stronger rouble, according to Reuters estimates. The finance ministry has already cut its full-year revenue forecast from 10.94 trillion to 8.32 trillion roubles, down from 11.13 trillion in 2024. Official figures are expected on 5 August. Finally, the front-month Sep/Oct and 6-month Sep/Mar’26 spreads are at $0.79/bbl and $2.07/bbl respectively.

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European Window: Brent below $69/bbl

The Sep’25 Brent futures contract saw lower highs over the afternoon. The contract fell from over $69.20/bbl at 13.45 BST to below $68.45/bbl at 15.09 BST. Although the contract rose above $69.00/bbl around 16.05-16.15 BST, it failed to maintain this and is at $68.95/bbl at 17.20 BST (time of writing). The Lindsey Oil Refinery in North East Lincolnshire will shut after the government failed to find a buyer, following owner Prax’s administration last month, putting 420 jobs at risk. Energy Minister Michael Shanks criticised Prax’s handling, urged them to support workers, and announced guaranteed employment for the coming months plus government-funded training to help workers transition into clean energy jobs, while the Official Receiver seeks buyers for individual assets. Iraq plans to boost crude oil shipments next month, increasing destination-free Basrah Medium exports to around 18mb (20-30% above average). This expansion, part of a broader OPEC+ production surge amid a global supply surplus, includes both destination-free and restricted shipments of Basrah Medium, Basrah Heavy, and Qayara grades. Zambia’s state-owned Industrial Development Corp. signed an MoU with China’s Fujian Xiang Xin Corp. to build a $1.1 billion oil refinery in Ndola, Copperbelt province, with a planned capacity of 60kb/d. The IDC did not disclose the source or transport plans for the crude oil feedstock. Britain imposed new sanctions on two Russian firms: Intershipping Services and oil trader Litasco Middle East DMCC, to pressure Moscow, adding them to its Russia sanctions regime. The update also included 137 additional designations, according to a government notice. US Treasury Secretary Scott Bessent said that the next round of US-China talks may address China’s purchases of sanctioned Russian and Iranian oil, shifting trade negotiations toward national security issues. He warned that buyers of Russian oil could face up to 100% secondary tariffs, urging European allies to follow suit – “I would urge our European allies, who have talked a big game, to follow us if we implement these secondary tariffs”. At the time of writing, the front-month (Sep/Oct’25) and Sep/Mar’26 Brent futures spreads stand at $0.77/bbl and $2.13/bbl, respectively.

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Refinery Margins Report

– In the week ending 11 July, refinery margins declined slightly across all tenors, except for Q1’26 for Asian refineries, which increased by 0.13.

– On a month-on-month basis, all margins have increased, with M1 in Europe and the US showing the largest rises of 2.33 and 2.96, respectively.

– Despite M2 and M3 being slightly higher than M1 on the Asian refinery forward curve, the rest of the curve remains in contango. The higher M2/M3 margins are driven by stronger M2 levels across the cracks, with MOPJ, kerosene, gasoil, and 380 Dubai cracks priced higher over the past month. The M2 92 Dubai crack was priced higher on 11 July.

– The European refinery forward curve similarly showed a higher-priced M2, with prices further along the curve also elevated, as M9 through M12 traded above M8. Both M2 and Q4’25 saw higher prices across naphtha cracks.

– The US refinery forward curve is in contango from M1 through M7, but prices jump at M8 and remain higher than M7 through to M12.

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European Window: Brent sells-off below $70/bbl

The Sep’25 Brent futures contract initially climbed to $70.75/bbl around 13:20 BST, where it met resistance. Despite fighting to remain above the critical $70/bbl handle at first, prices ultimately sold off and stand at $69.30/bbl at 17:30 BST (time of writing).

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Fuel Oil Report – VERY LOW sulphur fuel oil

High Sulphur Fuel Oil has been weak, but there seems to be more buying interest at these levels. The Aug’25 3.5% barge crack rose early from -$2.45/bbl on 8 Jul to -$1.75/bbl on 9 Jul, then fell to -$3.75/bbl on 14 Jul before recovering to -$3.10/bbl, with open interest slipping to 30.82mb and net positions easing to 965kb. The Aug’25 380 East/West dropped from $6.50/mt on 4 Jul to -$8.00/mt on 17 Jul, rebounding to -$5.75/mt on 18 Jul, while net positions fell from +975kb to +778kb as trade houses cut length. The Aug’25 Visco rallied from $8.25/mt on 4 Jul to $12.50/mt on 16 Jul, then eased to $12.00/mt, with open interest jumping to 6.29mb and net positions flipping from +447kb to -63.5kb. Trade houses drove much of the positioning shifts across all contracts amid volatility. Overall, cracks and East/West stayed weak but off lows

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COT Deep Dive – Sing 0.5% Crack

In this publication, we leverage Onyx’s proprietary Commitment of Traders data in order to identify changes in swap Open Interest and Positioning against Onyx with a view, in conjunction with long/short entry price levels and volatility analysis to identify potential continuation or reversal trends. In this edition, we take a look at the Aug’25 Sing 0.5% Crack.

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COT Deep Dive – Brent/Dubai

In this publication, we leverage Onyx’s proprietary Commitment of Traders data in order to identify changes in swap Open Interest and Positioning against Onyx with a view, in conjunction with long/short entry price levels and volatility analysis to identify potential continuation or reversal trends. In this edition, we take a look at the Aug’25 Brent/Dubai contract. 

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Trader Meeting Notes

Trader Meeting Notes: A whole lot of nothing

It is hard to keep Brent away from the $60s, with price action slipping from $71.55/bbl at the start of the week to $68.90/bbl at the time of writing on 17 Jul. Nevertheless, NWE and Asian refinery margins remain supported, bolstered by robust gasoil cracks, despite larger-than-expected EIA-reported gasoline and distillate fuel oil builds. Onyx’s CFTC predicting model anticipates producers/merchants to add to their ICE LS gasoil and RBOB shorts in the week ending 15 Jul, which, if true, should signal rising refiner hedging at these levels. On the macro side, nobody seems to be reacting too much to trade tensions, although the EU has prepared a list of potential retaliatory tariffs in case trade talks with Washington break down. Meanwhile, Washington has also threatened sanctions on buyers of Russian exports should the Kremlin fail to secure a ceasefire deal with Ukraine – a decision that does not seem to faze India’s energy minister Hardeep Singh Puri, who remains confident India can meet its oil needs from alternative sources. Also in Washington, President Donald Trump has been desperately trying to steer his loyalists’ attention away from Jeffrey Epstein and onto more important matters, such as coercing Coca-Cola to switch from high fructose corn syrup to cane sugar. President Trump also reportedly showed off a draft of a letter firing Federal Reserve Chair Jerome Powell on 15 Jul, although he has since flipped to saying that he is “not planning” to fire Powell. While the DXY seems to have recovered from an intraday low of 97.714, Mr. Powell’s confidence likely has not.

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European Window: Brent breaks above $69/bbl

The Sep’25 Brent futures contract has seen a choppy afternoon, albeit still rangebound around $68/bbl. Prices finally broke above $69/bbl around 16:30 BST and stand at $69.36/bbl at 17:35 BST (time of writing), where they appear to be meeting resistance.

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European Window: Brent Supported At $68/bbl

The Sep’25 Brent crude futures briefly fell below $68/bbl but was supported above that level on Wednesday afternoon, trading at $68.22/bbl at 17:30 BST (time of writing). EIA stats indicated a 3.9mb draw in crude inventories in the week ending 11 July, against API indications of 800kb build. Commercial stocks are still 8% below the 5-year average for this time of the year. India’s oil imports from Russia rose marginally in 1H25, at 1.75mb/d, with Reliance and Nayara Energy making almost half the purchases. Egypt’s diesel and gasoil imports reached a record 370kb/d in the first half of July, 65% higher y/y. Rising imports have diverted barrels away from northwest Europe to the Med, likely exacerbating the tightness in ICE gasoil. Drone attacks on Iraq’s Kurdistan region have reduced crude production by approximately 140 to 150kb/d, according to two energy officials. Finally, the front (Sep/Oct) and 6-month (Sep/Mar) Brent futures spreads are at $0.89/bbl and $2.36/bbl respectively.

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COT Report: Sweet Spot

See all the updates across the barrel in this week’s Onyx Commitment of Traders report, as well as six contracts to watch. Click on the relevant button below to access your COT report.

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