The October Brent Futures contract has seen a mixed overnight session, initially trading rangebound between $67.20/bbl and $67.60/bbl before falling sharply at 09:00 BST to $66.70, and subsequently rising back to $67.45/bbl, where it trades at the time of writing, 11:10 BST. In headlines, at a press conference earlier today, Trump hinted that China could face similar tariffs to those levied against India earlier in the week, stating, “We did it with India. We’re doing it probably with a couple of others. One of them could be China.” He justified the move as “necessary and appropriate” to penalise indirect support of the Russian economy, framing the move as part of broader efforts to curb Russia’s oil revenues amid the Ukraine conflict. On Wednesday, Trump also stated there was a “very good chance” he would soon meet with both Putin and Zelenskyy as part of renewed efforts to broker peace, as the US special envoy Steve Witkoff held talks in Moscow yesterday. Meanwhile, China’s crude oil imports rose 11.5% y/y in July to 11.12 mb/d, according to data from the General Administration of Customs cited by Reuters, primarily driven by state refiners ramping up processing after maintenance. However, imports were down 5.4% from June’s nearly two-year high of 12.14 mb/d, when independent teapot refiners stocked up on heavily discounted sanctioned crude, including from Iran. In contrast, July saw reduced buying by independents, while state-owned refiners increased activity. According to Oilchem, China’s refinery utilisation rate climbed to 71.84% in July, up 1.02 percentage points from June and 3.56 points higher than July 2024. At the time of writing, the front (Oct/Nov) and 6-month (Oct/Apr’26) Brent Futures spreads are printing at $0.59/bbl and $1.63/bbl, respectively.
