In the week ending 26 Aug, the M1 (Oct’25) Brent futures contract saw an uptrend in prices from $66 to $69/bbl. The contract saw better support as traders anticipated more US sanctions on Russian oil, as well as supply tightness concerns from Ukrainian attacks on Russian energy infrastructure. In addition, risk assets were boosted by the prospect of interest rate cuts following dovish comments by Powell. Gasoline and distillate cracks rallied mid-week following the shutdown at BP’s Whiting, Indiana, refinery, but gains were reversed at the start of this week.
Given the bullish sentiment across the board, we anticipate money managers to add long positions and remove short positions across the selected futures benchmarks, in Brent, Gasoil, and RBOB. In Brent, we expect a risk-on sentiment from physical players. In gasoline, the addition of length was offset by the exit of prod/merc longs and the entry of swap and ‘other’ shorts.
Further detailed information on other categories and contracts can be found in the report.
