Brent Eases As US Crude Stocks Surge

In the news, US crude inventories excluding the SPR rose by 17.4mb w/w to 424.4mb in the week ending 07 Aug, marking the largest weekly build since Jan’23 and pushing stocks to their highest level since 05 Jun. The unexpected build was driven by weaker exports, compared with market expectations of a 1.4mb draw. Elsewhere, Saudi crude exports from the Red Sea are increasingly going “dark”, with tankers switching off tracking signals to avoid attacks by Iran-aligned Houthis. The Houthis’ maritime embargo against Saudi Arabia has prompted more vessels to operate without visible tracking data. With recent Yanbu loadings reportedly all conducted “dark”, visibility into Saudi crude exports has deteriorated, with ship-tracking firms producing increasingly divergent estimates of actual flows. In Russia, the Orsknefteorgsintez refinery halted processing on 11 Aug following a fire caused by a Ukrainian drone attack, according to Reuters sources. The strike damaged several refining units at the 115kb/d refinery, which processed 4.2Mmt of crude in 2024, producing 1.8Mmt of diesel, 600kt of gasoline, 500kt of bitumen and 200kt of fuel oil. Related, the Orenburg region has introduced fuel rationing following the drone strikes, with the regional governor describing the situation as “difficult”. Restrictions include limits on gasoline sales, a ban on filling jerry cans, caps on volumes sold and an odd/even-day system based on vehicle licence plates. Finally, as of the time of writing, the front-month (Oct/Nov) and 6-month (Oct/Apr’27) Brent futures spreads are at $2.33/bbl and $9.67/bbl, respectively.

This afternoon in Dated we saw strong buying in the front of the curve pre-window with 17-21 Aug vs Cal Sep getting lifted up to $3.05/bbl and 13-17 Aug vs Cal Sep lifted up to $3.95/bbl. However, we saw selling come out in the window with 24-28 Aug CFD trading down to $2.28/bbl and the 1-week down to $0.65/bbl. We did see a major buying 1-4 Sep CFD at $0.20/bbl from a major and a trade buying 7-11 Sep CFD at $3.36/bbl from a major. In the physical window a British major offered down a Brent cargo again pushing down the physical diff, whilst majors also offered Midland and Ekofisk cargos. Post-window, we saw better selling with balmo offered at $3.05/bbl.

This afternoon there continued to be tradehouse and major selling of Sep, Oct and Q4 Brent/Dubai. The Sep Brent/Dubai was initially trading rangebound between $5.45/bbl to $5.65/bbl, but then sold off to $5.05/bbl. On the move lower there was also selling of Sep/Oct, Oct/Nov and Nov/Dec Brent/Dubai box selling and spread buying. The Sep/Oct box traded down from -$0.15/bbl to -$0.30/bbl.

This afternoon in VLSFO, Euro 0.5 spreads and cracks saw some real buying with Sep/Oct trading up from $24.50/mt to $25.25/mt, Sep Euro crack traded up from $7.05/bbl to $7.20/bbl. There was some real selling on Sep/Oct Sing which got absorbed at the $32.35/mt level, Sep Sing cracks traded around $18.10/bbl during the window before bouncing up to $18.25/bbl post-window. The E/W remained stable throughout the window at $70.25/mt.

In HSFO, there was real selling on E/W this afternoon from Chinese players, which saw it trade all the way down to $44.25/mt, it has since rebounded to $45.00/mt. Sep/Oct 380 traded down to $27.75/mt while the Sep crack traded marginally higher to -$3.65/bbl. The Barge crack was much stronger this afternoon on the back of the e/w selling trading up from -$10.90/bbl to -$10.55/bbl, Sep/Oct barges traded up to $13.00/mt.

This afternoon in distillates, Sing gasoil spreads saw selling in Dec/Mar, trading up at $11.70/bbl on higher ICE gasoil. Front E/W saw buying between -$72.50/mt and -$72/mt, while Oct was lifted up at -$62.75/mt. Regrade continued well offered, Sep trading down to -$2.05/bbl, while Dec was hit down to $3/bbl.
Prompt ICE gasoil spreads were rangebound in the front, with Sep/Dec trading around $170.25/mt, while Oct futures cracks rallied to $71.70/mt. European jet diffs weakened slightly, with Sep down to $67/mt. Both heating oil spreads and HOGOs firmed, with Sep HOGO swap trading from 28.0c/gal up to 28.4c/gal.

This afternoon in gasoline RBBRs were choppy but they rallied slightly post-stats. Arbs were mixed and remained rangebound between 8.40c/gal and 8.65c/gal, with Q4 arbs offered at 21c/gal. EBOB cracks lacked direction as well, trading at $30.70/bbl end window. Spreads were a touch stronger on higher RBBRs, with Sep/Oct seeing scaleback selling up to $88/mt. The East was thin but there was some spread buying in Sep/Oct up to $4.60/bbl.

It was a relatively weak afternoon in naphtha, with NWE naphtha MOC better offered and cracks staying under pressure from the morning, albeit recovering slightly through the window. Sep cracks fell down to -$6/bbl pre-window before ending around -$5.85/bbl, while Q4 traded around -$6.40/bbl. Prompt spreads were heavy as well, with Sep/Oct trading down to $19.75/mt before recovering to $20.50/mt. E/W was softer but relatively quiet, with Sep easing to around $34.75/mt and Q4 holding near $34.50/mt. MOPJ stayed weak into the window, with Sep cracks moving lower to around -$2.10/bbl, and front spreads had real sell-side interest from majors, with Sep/Oct trading down to $19/mt and Oct/Nov near $21/mt.

This afternoon in NGLs, FEI spreads had some sell side interest, with Sep/Oct trading down from $27/mt to $26/mt, and Oct/Nov was trading at $14/mt. In the deferred, May/Jun 27 FEI was sold at $10/mt. Sep FEI/MOPJ had good buying this afternoon, trading up from -$71/mt to -$66.50/mt, before settling end window at -$68/mt. The Q4/Q1 FEI/MOPJ roll was sold at $1/mt, and Jan/Mar was trading at $17/mt. Arb interest continued into the afternoon, with importers on the buyside of ENT/CP in Sep at -$325/mt, and Sep/Q4 ENT/NWE at -$6.50/mt. Q4 LST/FEI sold at -$265/mt, $1 stronger than yesterday’s closing level. Mixed interest in LST spreads, with Sep/Oct getting lifted at -0.625c/gal, and Q4'26/Q1'27 sold at -0.5c/gal, before strengthening to close the afternoon at -0.375c/gal. Sep/Winter 26/27 LST was lifted at -1.625c/gal by US trade. A relatively quiet afternoon in Butane today, but Sep/Oct C4 ENT was getting bought at -0.75c/gal, and C3/C3 LST was trading at 31.75c/gal, up 50c from yesterday’s closing level.