The Dec’25 Brent futures contract has traded in the $62/bbl handle this morning, from $62.23/bbl at 05:00 BST to $62.59/bbl at 07:45 BST. Prices eased further to $62.06/bbl at 11:00 BST (time of writing). In the news, Britain has issued a special licence granting businesses to work with two German-based subsidiaries of sanctioned Russian oil company, Rosneft; this license is valid until March 2026. In other news, the American Petroleum Institute has estimated that US crude inventories fell by 3mb in the week ending 17 Oct. In Norway, Aker BP has posted a slightly higher-than-expected core profit for Q3, increasing its 2025 output target from 400-420kb/d to 410-425kb/d. In India, Reuters has reported that the US and India are nearing a trade agreement that would cut US tariffs on Indian imports to 15-16%, down from 50%. The deal, according to India’s Mint, hinges on energy negotiations and may see a gradual scale back of Russian crude imports from India. Finalisation likely will be announced at the ASEAN Summit this month, according to Mint. Elsewhere, Serica Energy has announced that it will no longer be able to transition from the AIM market to the London Stock Exchange’s main market this year, citing regulatory complexities arising from its plans to purchase BP’s stake in North Sea assets. In the US, the Department of Energy has said that it is seeking to purchase 1mb of crude oil to be delivered to the Strategic Petroleum Reserve (capacity 700mb). According to Reuters, this is an effort to replenish the stockpile, which currently houses just nearly 409mb. Finally, at time of writing, the front-month Dec/Jan’26 and 6-month Dec/Jun’26 spreads are at $0.31/bbl and $0.28/bbl, respectively.
Crude
More bid this morning in Dated with Nov DFL trading up to $0.45/bbl before easing to $0.37/bbl as spreads sold off, whilst Dec DFL traded up to $0.22/bbl. We saw buying of 27-31 2w at $0.12/bbl as well as continued buy side interest in 3-14 Nov vs 17-28 Nov and 3-7 Nov 1w from a refiner. However, a trade and major were offering 17-21 CFD down to $0.20/bbl. Further down the curve, we saw buying of 24-28 Nov vs Cal Dec at $0.11/bbl and buying of 11-17 Dec vs Cal Dec at flat in size.
Fuel Oil
This morning in VLSFO, Sing 0.5 opened strong this morning, with buying in front spread up to -$2.50/mt and with the front crack traded up to $6.10/bbl. Heading into the window, we saw better selling in Dec and Jan Sing crack, which pressured the front crack down to $6/bbl. Post window, we saw better selling in front Sing 0.5 E/W at $27.75/mt which further pressured the front crack down to -$5.90/bbl. In Euro, front spreads were better bid, with Nov/Dec traded up to -$0.25/mt. Front crack also saw outright buying at $1.60/bbl initially but softened due to the front Sing crack weakness down to $1.45/bbl.
In HSFO, front 380 spreads were well offered at open, with Nov/Dec traded down to -$1.75/mt. This pressured the front 380 crack, traded down to -$4.20/bbl. Post window, front 380 E/W was better offered at -$4.50/mt, but backend E/W saw buying with Q1 bid to $7.25/mt. Q1 barge crack also saw selling at -$5.50/bbl, but the front barge crack was supported at -$3.35/bbl due to the selling in front E/W.
Distillates
This morning in distillates, prompt Sing gasoil spreads rallied initially, moving from $1.67/bbl to be lifted on screen at $1.70/bbl, before turning better offered and falling back down to $1.64/bbl post-window. The E/W opened weaker, trading down to -$23/mt before bidding up to -$21.75/mt, then turning better offered and being hit on screen at -$23/mt. Nov regrade weakened initially, hit down to $0.40/bbl before rallying back up to $0.50/bbl.
Prompt ICE gasoil spreads rallied from $17.75/mt up to $19/mt before selling off to $18.25/mt, while the Nov crack strengthened to $24.80/bbl before easing back to $24.60/bbl. European jet diffs continued to rally, with Nov firming from $56.50/mt to $58.25/mt, last trading at $57.50/mt. Heating oil spreads and HOGOs both traded rangebound, with the Nov HOGO last at 14.4c/gal.
Gasoline
This morning in gasoline, MOC was offered with flat price trading at $73.85/bbl end window. 92 front cracks stayed rangebound, trading 5c around $11.95/bbl. Front spreads traded at $1. 53/bbl at the beginning of the morning, strengthening to $1.60/bbl post window. E/W saw slight strength in Nov increasing 10c to -$1.75/bbl, but came off from -$0.55/bbl to -$0.65/bbl in Dec. In EBOB, the front crack strengthened from $13.60/bbl to $13.80/bbl. There was interest in Q1, being bid up 5c to $10.75/bbl post window. Front spreads strengthened from $22.75/mt pre window to trading at $23.50/mt.
Naphtha
This morning in naphtha, MOPJ flat price traded end window at $547.50/mt with MOC better bid. MOPJ cracks were well bid, with Dec climbing from -$0.85/bbl to -$0.65/bbl. Spreads also strengthened, as Nov/Dec traded up from -4.25/mt to $4.50/mt, and E/W had some selling interest but rallied from $33.50/mt to $34/mt. Naphtha cracks firmed form -$4.30/bbl to -$4.20/bbl in the front, with Q1 valued at -$4.68/bbl post window. Spreads also strengthened, with Nov/Dec trading up from $1/mt to $1.50/mt.
NGLs
Quiet morning in NGLs. FEI better bid in the morning with prems up 1c/gal this morning. Buyside interest from Euro trade in Q1 and Q2 FEI/CP with market makers selling, with Q1 FEI/CP trading $22/mt, bid on shortly after. CP spreads weaker on the back of this with Nov/Dec CP trading down from -$7/mt to -$9/mt with Dec/Jan trading -$9/mt. Interest in FEI flat price balanced end of window with $480/mt getting both hit and lifted on screen. In Europe, Nov E/W trading up to $65/mt post window, bid on from trade with Dec/Jan E/W box trading $1/mt.
Morning Macro
- Financial market headlines may look healthy with S&P500 and Nasdaq back right to all-time highs but below the headlines liquidity is straining.
- Regional banks are down 20-30% in the last few weeks, buy-now-pay-later companies down 30-40% and tertiary crypto names also down -30-40%.
- This is why US 2’s, 10’s and 30-year bond yields are all trending lower, and on medium term cycle lows. In fact, the 30-year yield is now 60bp below May’s ‘sell US debt’ panic.
- Other big news of course was the precious metal sell off, gold and silver down yesterday -5.3% and 7.3% respectively, golds biggest fall since 2013.
- Gold even fell to dead on $4,000 over night before bouncing (yesterday’s high $4,375).
- But the other key price everyone seems to be missing is the rally in the US dollar.
- The first nine months of 2025 was ‘SELL DOLLAR’ headlines, but now we’ve seen a clear double bottom, and are witnessing another squeeze of a crowded trade.
- Bank of England Governor Andrew Bailey warned that the collapses of US firms First Brands and Tricolor could be “canaries in the coal mine” potentially signalling systemic risks…… but central banks have no Liquidity tools for private credit markets.
- TRUMP: AS OF NOV. 1, TARIFFS ON CHINA WILL BE ABOUT 155%
*TRUMP: HIGHER TARIFFS ON CHINA WON’T BE SUSTAINABLE FOR THEM- 17:33 – TRUMP: WILL SEE PRESIDENT XI IN TWO WEEKS IN SOUTH KOREA
- 17:52 – TRUMP: MAYBE MEETING WON’T HAPPEN WITH XI
- UBS WARNS: RECESSION PROBABILITY NOW AT A STAGGERING 93%
- U.S. SERIOUS CREDIT CARD DELINQUENCIES (90+ DAYS UNPAID) SURGE TO HIGHEST LEVEL IN 14 YEARS
- WAL 3Q PROVISION FOR CREDIT LOSSES $80.0M, EST. $42.4M
- UK CPI unexpectedly stays at 3.8% (est 4.0%), OIS increases chance of a rate cuts with 60bp cuts now priced for the next 12 months.
- More debt concerns, this time China whose debt continues to grow. Total debt-to-GDP has soared to a record 336% in Q2 2025 – the highest in its history. To put things in perspective. Magnificent 7 market capitalization is bigger than the GDP of China.
- OpenAI is now the world’s most valuable private company, valued at $500 billion.
- Prediction Markets Boom as Volumes Surpass 2024 Election – Bloomberg
- No key data today.
