Flux Insights makes its exclusive debut on Flux.live diving straight into the fast-changing landscape of the oil markets. Hosted by Head of Research Harry Tchilinguirian, and joined by analysts Harinder Sandhu and Mita Chaturvedi, the team breaks down the week’s biggest developments across crude and product markets.
Crude Sentiment Turns Bearish
OPEC+ has fully rescinded its 2.2 mb/d voluntary cut—but rather than strengthening prices, the move has triggered a bearish response. Brent has slipped out of the 70s, now trading around $66–68/bbl, with key support levels being tested. Saudi Arabia and the UAE have already increased production, adding to downside pressure.
Gasoil: From Peak to Neutral
On the product side, gasoil and diesel cracks have fallen, pressuring refining margins and prompting speculation of reduced crude demand.
Positioning data shows funds pulling back after weeks of accumulation. Onyx’s proprietary positioning index flagged a sharp deleveraging—dropping from a high of 47 to a neutral 17—signaling an unwind of earlier bullish bets.
Source: Flux Insights
Brent & Gasoil: A Technical Breakdown
Technical analysis highlights bearish momentum across both Brent and ICE Gasoil:
- Brent has broken below the Ichimoku cloud, with MACD and RSI pointing to selling momentum.
- Gasoil futures also breached key support levels, with a bearish Marubozu candle confirming sell-side conviction.
These indicators, combined with weakening fundamentals, suggest more downside risk in the near term.
High-Conviction Trade: Short Sep’25 DFL
This week’s Alpha Trade Idea focuses on shorting the Sep’25 Dated-to-Frontline (DFL) swap. Onyx sees weakening refinery margins, additional OPEC+ supply, and a seasonal demand lull as reasons to expect the DFL to retreat from $0.90 toward a target of $0.80/bbl.
In the Crystal Ball
Looking ahead, Onyx forecasts Brent to remain under pressure, potentially closing the week in the $67–70 range. Positioning scores, momentum indicators, and macro fundamentals all suggest there’s more room for retrenchment.
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