Brent sees support on continued supply uncertainty

In the news, US crude oil inventories rose 4.4mb to 428.8mb in the week ending 14 August. Gasoline stocks climbed 0.7mb to 209.4mb while distillate inventories fell 1.5mb to 105.6mb. Stocks of crude in Cushing, Oklahoma fell 1.3mb to 21.3mb. Oil shipments from Russia's western ports have fallen to 2.3mb/d in 1H August, 15% short of the initial loading plan amid disruptions at Novorossiysk. Meanwhile, US Energy Under Secretary Kyle Haustveit stated that about half of Venezuela's oil output is now exported to the US - with US refiners built for Venezuelan crude grades receiving more than 500kb/d of crude oil. Jovanny Martinez, a VP at Venezuela's PDVSA, said that Venezuelan crude oil output would reach 1.245mb/d by the end of August. Elsewhere, India is offering incentives to its regional gas distributors to boost domestic connections of piped cooking gas. Under the incentives, these gas distribution companies will get an additional 200 standard cu m of cheaper, domestically produced gas for each household they connect to - which could help India speed up its shift from LPG to piped gas for household purposes in a bid to cut down LPG imports. Finally, at the time of writing, Oct/Nov'26 and Oct/Apr'27 Brent futures spreads stand at $1.81/bbl and $10.71/bbl, respectively.

This afternoon in Dated Brent, we saw continued selling of 24-28 Aug vs Cal Sep at -$0.10/bbl pre-window and buying of 1-4 Sep 3w up to $0.62/bbl. We also saw better buying of the Oct/Nov DFL roll, bid up to $0.10/bbl. In the physical window, we continued to see cargos offered across Midland, Forties and Ekofisk, pushing down the implied physical differential. However, a trade lifted 2 Midland cargo offers and bid a Forties cargo. The paper window was quieter, with a trade and major buying 1-4 Sep CFD at $2.6/bbl, 7-11 Sep CFD at $2.6/bbl and 14-18 Sep CFD at $2.4/bbl. Post window, we saw a major selling 24-28 Aug 1w.

This afternoon in Brent/Dubai, the Sep Brent/Dubai traded range-bound between $3.90/bbl and $4.10/bbl. There were large amounts of Oct through Feb Brent/Dubai box selling, as well as refiner and major buying of Oct and Nov Brent/Dubai. This meant that despite the Sep Brent/Dubai trading in a tight range, the Q4 Brent/Dubai rallied from $5.40/bbl to $5.70/bbl. There was continued strong buying of Dubai spreads, which all rallied sharply; the Sep/Oct Dubai spread rose from $3.40/bbl to $3.75/bbl.

In VLSFO, this afternoon, Sep/Oct Sing 0.5 traded between $34.50/mt and $35.00/mt on low liquidity. Sep Sing crack traded down from $18.50/bbl to $18.25/bbl. Euro 0.5 sold off this afternoon, from $6.00/bbl down to $5.65/bbl at the end of the window. There was little spoken of Sep/Oct Euro this afternoon; it traded at $22.50/mt during the window and is currently $22.75/mt value

In HSFO, Sep/Oct 380 was range-bound this afternoon, trading between $38.50/mt and $38.75/mt. It was a similar story with Sep crack; it traded around -$0.05/bbl and then sold down to -$0.20/bbl post-window. 3.5% barges encountered some real selling this afternoon; Sep/Oct traded down from $18.50/mt to $17.50/mt, and Sep crack sold down to -$9.35/bbl from -$8.85/bbl.

This afternoon in distillates, Sing gasoil spreads were mixed as ICE gasoil moved around, with Sep/Oct trading from $6.50/bbl down to $6.40/bbl, then back to $6.50/bbl last. The front gasoil E/W remained bid, trading up to -$68.25/mt in Sep, while Q1 sold down to -$56/mt. Kero spreads were more buy-side in Sep/Oct trading from $2.05/bbl up to $2.20/bbl.

Prompt ICE gasoil spreads sold off initially before firming post-stats, with Sep/Dec trading from $162.50/mt down to $155/mt before coming back to 159 last, while cracks remained at $75.50/bbl in Oct. European jet diffs sold off in the front, with Sep trading from $61/mt down to $58/mt, while Q4 traded down to $99.50/mt. Heating oil spreads were range-bound, while HOGOs rallied; Sep HOGO swap from 30.30c/gal up to 31.60c/gal.

This afternoon in Gasoline, MOC was better bid. RBBRs were trailing lower this afternoon, although EBOB remained somewhat supported, taking the Sep Arb down to 3.50c/gal. There was some buying in Sep/Oct EBOB, but it found selling at the $100/mt handle. Buying in the Q1/Q2/Q3 27 crack roll fly from a trade – stepping up from -$8.20/bbl to -$8.10/bbl. The gasoline E/W continues to sell off this afternoon, with 92 spreads also better offered, seeing Sep/Oct 92 getting hit 5 on screen, with Sep gasoline E/W trading down to -$15.35/bbl.

This afternoon in naphtha was mixed after the bid morning, with naphtha MOC better bid but NWE cracks ultimately coming off into the close. Sep NWE cracks rallied from the morning’s -$3.85/bbl to around -$3.30/bbl before fading, ending closer to -$4.20/bbl post-window; spreads also gave back some of the earlier strength, with Sep/Oct finishing around $26/mt after trading up to $28.50/mt, while Oct/Nov ended near $25.75/mt. The naphtha E/W was choppy but broadly held up, with Sep recovering back to around $38/mt after trading down to $36.50/mt, while Q1 was bid up to $31.50/mt. MOPJ stayed better supported relative to NWE, with Oct cracks seeing real buying interest up to -$0.50/bbl post-window; spreads finished steady, with Sep/Oct around $26/mt.

This afternoon in NGLs, Sep/Oct FEI was trading at $24/mt before rallying post-window to $26/mt. Dec/Jan FEI was lifted to $14.50/mt, before it softened a touch to close at $14/mt. Sep LST/FEI traded up to -$316/mt, before weakening back to -$323/mt post-window. Oct LST/FEI was trading at -$292/mt, and Q4 was sold at -$278/mt, up $3 from last night’s close. At the beginning of the afternoon, we had a buyer of Nov-Dec ENT/FEI at -$281/mt, who returned for good size again at -$277/mt. Also saw Sep ENT/FEI get lifted at -$330/mt again for good size. LST spreads had mixed interest today, with Sep/Oct getting lifted at -0.25c/gal, and Q4/Q1 was sold at 0.25c/gal, before it weakened to 0.125c/gal at the close. There was good selling of Nov-Dec ENT/LST at -2.5c/gal, and Sep was sold at -2.5c/gal, the same as yesterday’s close. Butane liquidity was a touch better than previous days, and Nov/Dec was getting bought at 0.75c/gal, before weakening 0.125c/gal across the afternoon. Sep C4 ENT/C3 LST traded down from 34c/gal to 33.5c/gal, and Q4 was lifted at 33.5c/gal.