Brent climbs above $105/bbl on supply concerns

In the news, Chevron CEO Mike Wirth said that oil buffers that limited increases in crude oil prices earlier in the Iran war have been depleted, indicating that the war could lift prices further over the next few months. Meanwhile, Italy is adopting measures aimed at boosting domestic oil and gas production, seeking to cut red tape for drilling licenses and reduce the nation's dependence on fossil fuel imports. Italy currently produces about 29mb of crude oil per year and around 3 billion cu m of natural gas, much smaller than its domestic fossil fuel demand.  QatarEnergy is negotiating with producers to secure multi-year US LNG contracts through 2031to replace lost capacity from its Ras Laffan facility. QatarEnergy has previously purchased US spot LNG cargoes, marking this as a shift towards longer-term solutions to cover the supply shortfall. The Shanghai Futures Exchange will reportedly limit the maximum intraday opening positions for crude ​oil and LSFO futures contracts with delivery ‌in ⁠Oct and Nov to 800 lots and 3,000 lots, respectively. The Exchange will also adjust the price limit range for the crude oil and LSFO contracts with delivery in Oct and Nov to 16% and ​trading margins for hedging positions to ​17%. Finally, at the time of writing, the Nov/Dec'26 and Nov/May'27 Brent futures stand at $4.98/bbl and $20.22/bbl, respectively.

Strong rally in Dated this afternoon, with bank buying 21-2 Oct vs Cal Oct and trade house buyside of 28-09 Oct vs Cal Oct at $10.65/bbl and $4.70/bbl, respectively. Balmo DFL moved back up to print $13.00/bbl last. The physical actually moved lower, with a Mediterranean refiner offering Midland before getting lifted by US, whilst CFDs continued to rally, seeing 21-25/9 CFD lifted up to $11.85/bbl. Oct'26 DFL rallied to highs of $7.70/bbl, implying the DFL roll up to $2.50/bbl.

This afternoon in Brent/Dubai was very quiet and choppy in Brent/Dubai. There was continued selling of the Oct/Nov'26 Dubai spread outright, with some producer buying of the Oct/Nov'26/Dec'26 Dubai fly at $1.55/bbl. The Oct'26 Brent/Dubai traded slightly higher, but largely range-bound, finishing at the highs, trading between -$0.80/bbl to -$0.20/bbl. There was continued product and trade selling of the Bal and Sep/Oct'26 Dubai spread, which traded between $17.25/bbl to $18.00/bbl. The Brent/Dubai boxes were very quiet, with nothing trading OTC. The quarterlies were also quiet, with no more selling of $2027.00/bbl quarterlies by products and banks.

In VLSFO, Sing 0.5 spreads were thinner this afternoon, and MOC was bid; Oct/Nov'26 traded around $42.00/mt during the window, while Oct'26 crack was bid up on screen from $19.70/bbl to $20.20/bbl. Euro 0.5 spreads also lacked liquidity, with Oct/Nov'26 trading 50c lower from $18.25/mt to $17.75/mt. Oct'26 0.5 e/w traded between $108.00/mt and $110.00/mt.

In HSFO, 380 spreads saw moderate liquidity, with the prompt spread trading up from $38.00/mt to $42.00/mt before selling back down to $41.00/mt. Oct'26 380 crack was bid up from -$2.20/bbl to -$1.50/bbl, with most of the volume coming from screen; it traded back up to -$1.80/bbl by window end. Barge liquidity was thin; Oct/Nov'26 traded up from $18.00/mt to $19.50/mt, and the Oct'26 crack traded up from -$12.50/bbl to -$12.20/bbl before selling back down to -$12.50/bbl.

This afternoon in distillates, Sing gasoil spreads were more on the offer side, with Oct/Nov'26 trading from $10.30/bbl down to $9.50/bbl hit on screen last. Front E/W saw weakness, with Oct'26 hit from -$65.00/mt down to -$73.00/mt, while Nov'26 was also hit down to -$73.00/mt. Oct'26 regrade saw good selling down to -$2.00/bbl off the back of Oct/Jan'27 kero spread selling.

Prompt ICE gasoil spreads remained range-bound, with Oct/Nov'26 trading from $84.00/mt up to $87.00/mt, then back to $84.00/mt into the end of the window, while Nov'26 cracks remained at $83.00/bbl. European jet diffs sold off in the front, with Oct'26 trading from $136.00/mt down to $110.00/mt.

It was a choppy afternoon in gasoline, with RBBRs trading around $27.60/bbl at the end of the window. Arbs were thin in the front and mixed in the back, with Q2'27 valued at 28.50c/gal. EBOB cracks strengthened from $33.30/bbl to $34.75/bbl in Oct'26, with Q1'27 seeing buyside interest at $21.90/bbl. Spreads were bid as well, with Oct/Nov'26 getting lifted up to $96.00/mt. E/W drifted lower, trading at -$6.50/bbl at the end of the window, with Oct'26 cracks seeing better buy-side interest down to $28.20/bbl from trade houses.

This afternoon in naphtha was very illiquid, with MOC slightly better bid and spreads broadly offered as they priced up on higher crude. NWE naphtha cracks recovered from the morning lows, with Oct'26 up from around -$4.20/bbl to -$3.40/bbl, while the Oct/Nov'26 roll was around $0.30/bbl and Q1/Q2'27 held around $2.00/bbl. Spreads were higher versus the morning but still illiquid, with balmo up to $28.50/mt from $25.00/mt, while the rest of the curve saw little real bid interest. E/W came off from the morning highs before rebidding, with Oct'26 down from around $66.00/mt this morning to $64.50/mt pre-window before lifting back to $65.50/mt, while the Oct/Nov'26 box was around $2.50/mt and Q4'26 at $63.00/mt. MOPJ was illiquid but marked higher on cracks as flat price rallied with crude, while spreads saw limited trade, with Oct/Nov'26 at $42.75/mt versus around $40.00/mt this morning.

It was a quiet afternoon in NGLs, with LST flat price once again supported by buying in both the arb and FEI. LST traded around 86.375c/gal for most of the afternoon, with the arb trading at -$399.00/mt and Oct'26 FEI at $850.00/mt. LST spreads initially opened softer before gradually strengthening throughout the afternoon, with Q4/Q1'27 trading at 2.75c/gal and Q1/Q2'27 at 5.75c/gal. European flat price saw buy-side interest into the end of the window, with Oct'26 trading at $650.00/mt and the Oct'26 Euro arb also seeing buying interest at -$199.00/mt. US butane was initially offered, with flat price selling on the open, before rebounding with C4/C3 buying in Nov'26, driving the market to trade up to 44.25c/gal.