Brent Trades Choppily As Freight Rates Rise

In the news, freight rates for Russia's flagship Urals crude shipments from western ports to India have risen by around 50% since mid-July, as higher global shipping costs and growing security risks in the Black Sea discourage shipowners from calling at Russian ports, according to Reuters sources. While Russia is expected to increase exports from its western ports in August on firm Asian demand, a shortage of available tankers could limit how much it can actually ship. Related, Russia's oil exports from its western ports are expected to rise around 4% m/m to 2.7mb/d in August, as attacks on domestic refineries leave more crude available for export and firm Asian demand supports loadings. Exports from Primorsk, Ust-Luga and Novorossiysk are expected to run close to capacity, although continued Black Sea disruptions and a shortage of available tankers could limit volumes. July exports fell to 2.6mb/d after repeated Ukrainian attacks disrupted loadings at Novorossiysk. In India, the nation has raised windfall taxes on fuel exports with immediate effect, aiming to protect domestic fuel supplies and increase government revenues. Export duties on petrol have increased to 3.5 rupees/L from 2.5 rupees/L, diesel duties have risen to 25.5 rupees/L from 15.5 rupees/L through a combination of levies, and aviation fuel export taxes have been lifted to 22 rupees/L from 14.5 rupees/L. Elsewhere, an LNG vessel operated by Greek shipping company GasLog remains stable after an incident while exiting the Strait of Hormuz, with all crew reported safe. GasLog said the incident occurred on 31 Jul aboard the GasLog Shanghai but did not disclose whether the vessel or its cargo was damaged. The ship had loaded an LNG cargo at Qatar's Ras Laffan terminal on 27–28 Jul and was last tracked off Oman's Musandam Peninsula, just outside the Strait of Hormuz, after reappearing outside the waterway on 02 Aug. Finally, as of the time of writing, the front-month (Oct/Nov) and 6-month (Oct/Apr’27) Brent futures spreads are at $2.59/bbl and $7.99/bbl, respectively.

This afternoon in Brent/Dubai, we drifted lower, the Sep'26 Brent/Dubai down from $6.10/bbl to $5.85/bbl. There was some refiner buying of Sep'26 Brent/Dubai at $5.95/bbl, some trade selling of Q4'26 BThis afternoon in Brent/Dubai, we drifted lower, the Sep'26 Brent/Dubai down from $6.10/bbl to $5.85/bbl. There was some refiner buying of Sep'26 Brent/Dubai at $5.95/bbl, some trade selling of Q4'26 Brent/Dubai at $4.55/bbl. The Dubai spreads traded in a tight range, between $0.90/bbl to $1.10/bbl in the Sep/Oct'26 spread. The boxes also traded range-bound, the Sep/Oct'26 Brent/Dubai box trading between $0.55/bbl to $0.78/bbl.

Weakness that characterised the VLSFO curve this morning continued into the afternoon/ Sep/Oct'26 Sing continued to sell off, trading down to $37.00/mt from the morning close of of $40.00/mt. It was a similar story on cracks which closed the afternoon around $19.10/bbl. E/W was where we saw a lot of the weakness, consequently Euro 0.5 was weaker, but not as weak as Sing 0.5. Euro crack traded down a touch to $7.80/bbl from $8.00/bbl. Sep/Oct'26 Euro came off in the window finished the afternoon around $25.00/mt.

HSFO enjoyed a fairly range-bound afternoon. Sep/Oct'26 380 traded around $21.00/mt for the majority of the second half of the day. 380 cracks traded down a touch to -$3.90/bbl off the back of $380.00/bbl E/W in the front drifting down to $36.00/mt by close of play. The barge crack was largely unmoved trading down a touch in the window to -$9.75/bbl before closing afternoon where it started it, around -$9.60/bbl. Sep/Oct'26 barge traded up smalls to $10.75/mt.

This afternoon in distillates, Sing gasoil spreads moved much lower, with Oct/Nov'26 trading from $6.70/bbl this morning down to $6.15/bbl. E/W drifted higher in the front, with Sep'26 moving from -$62.50/mt up to -$59.00/mt, lifted last. Regrade was quiet, with Aug'26 trading at -$4.10/bbl, while Aug/Sep'26 kero traded at $4.35/bbl.

Prompt ICE gasoil spreads sold off throughout, with Sep/Dec'26 trading from $173.00/mt down to $159.00/mt, while Oct'26 cracks dumped to $62.10/bbl. European jet diffs traded down to $70.00/mt in Aug'26, while Q4'26 remained at $120.00/mt. Heating oil spreads sold off, while HOGOs rallied to 27.50c/gal in Sep'26.

This afternoon in gasoline, RBBRs drifted lower, but Sep'26 arbs firmed from 11.00c/gal to 11.60c/gal as EBOB went better offered. There was selling on Sep'26 cracks from $29.30/bbl down to $28.45/bbl, with Q4'26 trading at $17.50/bbl. Front spreads also came off on lower RBBRs, with Sep/Oct'26 trading down from $76.00/mt to $74.00/mt. E/W rallied from -$9.10/bbl to -$8.30/bbl with 92 cracks remaining stable around $20.00/bbl. Spreads came off before getting bid back up into the window, with Sep/Oct'26 firming from $4.70/bbl to $4.90/bbl.

This afternoon in naphtha, MOC better offered with Sep'26 crack better offered during window, getting sold down from -$3.00/bbl to -$3.20/bbl end of window. Some selling in Q4'26 Naphtha crack this afternoon -$5.80/bbl. Sell side interest in Q4'26 E/W this afternoon, seeing the seller trading down from $38.00/mt to lows of $36.50/mt post window with the Oct/Nov'26/Dec'26 E/W box fly getting lifted at $0.50/mt from small trade.

This afternoon in NGLs, FEI spreads had better buyside interest across the afternoon, with Sep/Oct'26 trading at $22.00/mt and Sep/Dec'26 at $41.00/mt. In the deferred, Q1/2 27 FEI was lifted at $57.00/mt, and Dec/Jan'27 was trading at $13.00/mt, where it settled post window. There was some LST/FEI buying out of Q4'26, trading at -$250.00/mt, before weakening $1 to settle at -$251.00/mt end window. The Cal 27 LST/FEI was also trading at -$180.00/mt. LST had good spread buying down the curve, with Sep/Oct'26 strengthening from -1.375c/gal to -1.125c/gal, and Oct/Nov'26 trading at -1.00c/gal. In the deferred, Q4'26/ Q1'27 was lifted at -0.625c/gal. In butane, Sep/Oct'26 C4 ENT was trading at -0.75c/gal and Oct/Nov'26 was lifted at 0.50c/gal. There was C4/C3 LST interest in Q4'26, trading at 30.50c/gal, and Cal 27 was sold at 18.00c/gal.