Brent lower at $104 in shadow fleet relief rumours

Washington is weighing sanctions relief for Russia’s shadow fleet, alongside a 1.8-million-tonne Russian diesel purchase it says will ease fuel prices. The IEA warns that diesel constraints could continue well into next year, as its board finalises the G7’s 100mb release. Moscow says Ukraine attempted a large-scale drone attack on the Ryazan refinery, starting a fire, after Zelenskyy said Kyiv was “done” with the energy ceasefire Trump announced at the weekend. Zelenskyy also accuses the US of weakening Ukraine by withdrawing intelligence sharing, while SpaceX’s 160 km/h cap on military Starlink terminals is disrupting drone operations. The Houthis say they targeted a Saudi Typhoon fighter jet and are continuing strikes on Riyadh; explosions have been reported at Aramco facilities, and heavy fighting continues around Taiz. In the Gulf, at least 10 ships have been struck in and around Hormuz since Sunday, the most over any such period since the war began, and a Singapore-registered ship was sunk in the strait. CNN reports that US plans for possible renewed strikes on Iran include using the MOAB, its largest non-nuclear bomb, against nuclear and energy targets. Finally, as of the time of writing, the front-month (Dec/Jan) and 6-month (Dec/May’27) are at $2.23/bbl and $11.12/bbl, respectively.

The Dated complex softened again this morning, with the weakness concentrated in the prompt. Balmo DFL came off from $9.50/bbl at the open on screen to $7.00/bbl despite refiner buying at $8.00/bbl and $6.70/bbl, and has kept easing since. Nov'26 DFL slid from $3.75/bbl on screen to $3.00/bbl before rebounding towards 3.50, while Dec'26 DFL edged up from $3.09/bbl to $3.10/bbl. This drove the Nov/Dec'26 DFL roll lower from $0.25/bbl to flat despite buying, with lots now trading at -9c. Real players sold Nov/Dec'26 Dated at $2.20/bbl. In the days market, real players bought 26-30 Oct'26 v 02-06 Nov'26 at -$0.08/bbl, 16 Oct'26 v 30 Oct'26 was bought at $15.00/bbl, and the 21 v 28 Oct'26 CFD roll was bought at $6.70/bbl and has eased since. On screen, Jan/Feb'27 Brent eased from $2.28/bbl to $2.25/bbl, while Dec/Jan'27 has come off from $2.41/bbl early, leaving the front Brent fly negative around -4c now.

This morning in Brent/Dubai we gapped higher, with the Nov Brent/Dubai opening around -$1.42/bbl, up from -$1.87/bbl, and trading up to -$1.32/bbl early. We sold off into the window, trading down to -$1.83/bbl, and post window we traded rangebound around there, with a low of -$1.92/bbl, finishing around -$1.8/bbl. As we moved lower post window, we saw dated dubai buying in Nov and Dec come in which kept us range bound.The Nov Dated/Dubai came off from $2.42/bbl to $1.09/bbl. The Nov/Dec Dubai spread was choppy, dipping to $2.52/bbl before recovering to $2.81/bbl, with late buying around $2.72/bbl. The Nov/Dec box traded down from -$0.28/bbl to -$0.45/bbl.

Sing 0.5 cracks opened lower and spreads traded at similar levels to yesterday evening while Euro 0.5 was much better bid than recent mornings. Nov/Dec'26 Sing opened at $28.00/mt and has traded between this level and $28.50/mt, Dec/Jan'27 Sing is trading between $28.00/mt and $28.25/mt. Nov'26 Sing crack opened 40c lower at $25.60/bbl, it briefly traded down to $25.35/bbl before getting bid back up to $25.70/bbl by window start, it continued to rally during the window topping out at $26.20/bbl, Dec'26 Sing crack opened 40c lower and then traded up 35c to $23.95/bbl. Euro 0.5 remained very illiquid however the prompt crack was much better bid this morning, Nov/Dec'26 traded at $16.00/mt in low volume while Nov'26 crack opened higher at $1.30/bbl, it then traded up to $1.50/bbl post window and then gapped up to $2.00/bbl before retracing to $1.80/bbl.

380 spreads opened stronger again this morning before pulling back while cracks opened weaker and then rallied. Nov/Dec'26 380 quickly traded up a dollar to $60.00/mt before selling down to $59.00/mt by window start and then getting offered down on screen to $58.00/mt during the window, post window it rallied back to $59.50/mt, Dec/Jan'27 was better offered trading down from $42.00/mt to $40.00/mt. Nov'26 380 crack opened 40c lower at $13.60/bbl, it was then aggressively bid up on screen to $14.50/bbl, sold off in the window to $14.00/bbl and has bounced back up to $14.30/bbl post window. Barge spreads were extremely illiquid this morning, Nov/Dec'26 traded once at $24.25/mt, Nov'26 Barge crack saw better liquidity and was better bid trading up from -$7.00/bbl to -$6.30/bbl.

This morning in distillates, Sing gasoil spreads were decently offered in 2027, with Dec/Dec trading at $42.10/bbl and Mar/Dec well offered at $28.00/bbl. E/W sold off initially before finding support, trading down to -$150/mt before recovering to -$135/mt. Regrade remained stable in the front, with Nov trading at $1.70/bbl, while Nov/Dec kero saw some buying at $2.10/bbl.

Prompt ICE gasoil spreads sold off, trading from $46.75/mt down to $43.00/mt, while Dec cracks weakened from $83.10/bbl down to $80.70/bbl.

This morning gasoline was weak. Nov 92 cracks got sold down from $21.80/bbl to $20.90/bbl by a refiner, and Nov/Dec came off from $6.45/bbl to $5.40/bbl. Gasoline E/W softened a touch, trading down from -$3.50/bbl to -$3.75/bbl as EBOB also came off. Nov EBOB cracks got offered down from $25.90/bbl to $25/bbl, and Nov/Dec EBOB weakened from $63/mt to $60/mt with trade houses on the sell-side.

This morning in naphtha was very choppy, with MOC trading flat and lower Brent supporting front cracks, while spreads moved with crude. MOPJ cracks were firmer versus last night, with Nov'26 up from around $5.10/bbl to $5.55/bbl, Dec'26 at $4.10/bbl and Q1'27 at $1.15/bbl; spreads opened softer and traded range-bound through the window, with Nov/Dec'26 ending at $34.50/mt versus $33.50/mt last night and Dec/Jan'27 unchanged at $28.50/mt after briefly falling to $27.50/mt. E/W was mixed, with Nov'26 trading between $84.00/mt–$85.00/mt before ending at $84.00/mt versus around $85.25/mt pre-window last night, while Dec'26 was $80.00/mt and Q4'27 at $32.75/mt. NWE naphtha front cracks strengthened, with Nov'26 improving from -$4.30/bbl last night to -$3.90/bbl after opening at -$4.00/bbl, while Q1'27 was -$6.00/bbl and Q1/Q2'27 traded at $2.10/bbl; spreads were slightly firmer, with Nov/Dec'26 around $29.75/mt–$30.00/mt versus $29.50/mt last night and balmo at $30.00/mt.

Quiet morning in NGLs, FEI structure was better offered with Nov/Dec'26 FEI opening at $40.50/mt, before at $39.00/mt to close. Dec/Jan'27 FEI traded back to $37.00/mt after trading at $37.50/mt during the window. This is down from $38.00/mt at yesterday’s close. FEI/CP was up with Q1'27 FEI/CP trading at $172.00/mt compared to $176.00/mt yesterday. Nov'26 FEI/CP traded at $225.00/mt which was down from $234.00/mt yesterday. Dec'26 FEI/CP was also weaker trading at $210.00/mt and $209.00/mt down from $219.00/mt yesterday afternoon. FEI/MOPJs were illiquid but firm against yesterday’s US close. Nov'26 FEI/MOPJ printed -$12.50/mt while Q1'27 FEI/MOPJ printed -$38.00/mt. The arb was very strong this morning as FEI was weak. Nov'26 LST/FEI opened around -$385.00/mt before trading at -$381.00/mt and highs of -$380.00/mt before dropping back to -$383.00/mt. The Q1'27 arb gapped up to -$305.00/mt which was up from -$315.00/mt yesterday. Nov'26 FEI rebounded slightly into the close where it was trading at $940.00/mt on screen.

Bond yields have peaked. And an equity bloodbath emerging.

A seismic reversal in Treasuries. After the hotter-than-expected CPI print (+3.7% YoY) sent the 2-year yield up 16bp to 4.95%, it has since dropped back to 4.73%, a 22bp turnaround from the high. Further out the curve, the 10-year is now 24bp below yesterday’s highs and the 30-year is 20bp lower.

The equity rout fuelled the afternoon bond rally, with AI stocks hit hardest. CoreWeave fell more than 15% and its bonds sold off alongside the shares. The Nasdaq closed down 1.9%.

After the close, reports emerged that Anthropic told prospective IPO investors its Q3 revenue reached $16.8 billion, up 45% on the quarter. This was a big disappointment while the company is reportedly targeting a valuation above $2 trillion, with a listing possible as soon as next month.

Asia followed through today. The Nikkei fell 4.9%, the Kospi dropped 7.6%, and China’s CSI 300 hit another new 52-week low.

While funds and asset managers are aggressively rotating back into bonds, the 73bp of hikes in the next 12 months of the US OIS curve are a clear sell.