The Officials

Dumper time! Just before the London close Brent plummeted more than $1, coincidentally as the UK joined in the party to spank yet more sanctions on Russia. Like the EU, the Brits lowered the price cap to $47.60/bbl – maybe they’re just desperate to get some deeply discounted crude to feed the beleaguered Lindsey refinery. The dump was coincidental in the timing as the oil market does not care what Europe has to say. The Russians and Chinese don’t care and they are the big ones that matter. But for good measure the Indians officially don’t care either! Hey, they have a lot of mouths to feed and they’re not listening nor following any unilateral sanctions, only UN ones. Just to be clear, the Chinese and Russians have a veto, so forget about UN sanctions. By the close, Brent had fallen back to $69.55/bbl. The prompt spread had been enjoying the gradual rise through the session, back above $1 – but also dumped in the window to 91c.

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Brent remained in the $68/bbl lever before charging ahead back to the $69 handle. A trader notes, ‘there is a lot of buying at the $68.50 level.’ The late London rally took it to $69.40/bbl. By press time. The prompt spread has rebounded from its low at under 80c yesterday to 94c by today’s close. As Brent traded in a comfy range today, the broader markets have largely recovered from the wobble and panic that Powell would be booted, with the USD strengthening again, while equity markets climbed and treasury yields fell slightly. Trump should know by now that the bond market is king and not him. Gold slid significantly, dropping 0.7%, while other metals, including platinum, continued their rally.

Top heavy? Short sell?  Nvidia’s been a massive driver of the last few months of stock market rally and has even exceeded the GDP of major countries! It’s market cap is now bigger than the GDP of Canada, the UK and India – and Germany’s next on the hitlist. In terms of market capitalisation, Nvidia is bigger than all but 5 national stock markets!  Only Hong Kong, India, Japan, China and the US itself are the only ones bigger! The stock market’s centre of gravity looks somewhat high, with such a mammoth share in a single company, and don’t look too closely at the price-to-earnings ratio! The impact of a correction on Nvidia will make us all cry. Get your handkerchiefs ready. Sanctions and secondary tariffs on Russian oil could put up another hurdle for India’s economy, as you’ll find out on page 2… But they don’t care.

An update regarding our Murban questions we asked Platts: We had a preliminary discussion with our fellow publisher, and they will prepare their answers in writing. We agreed this way is better as nothing will be lost in translation, so to speak. The issues are highly technical, and the company is still receiving comments. While we were supposed to be asking questions, they asked some of their own. We highlighted some issues including the fact that the proposal contains an inequity with the 50% discount one way and a 100% the other way. Dear reader we will be keeping you abreast of developments! In the meantime, we are still waiting for a reply from IFAD. Brent got dragged through the ringer today, dropping in the European morning and hoping Team America may come in to save the day. But they didn’t… And by the close flat price had tumbled to $68.02/bbl, even falling below $68 several times. The front spread has been whacked, clobbered and slapped this week. And it’s showing few signs of being out of the woods. From a peak at $1.28 on Monday, it has plummeted to just 80c today. Further down the curve, things held relatively steady as the front sold off – the monthly spreads managed to retain a few cents of backwardation until the July/August 2026 spread, after which things shift into a gentle contango.

The US administration is increasingly seen as a strident noise-maker with no substance and it’s risking not being taken seriously. The statements by the secretary of energy regarding the non-exemption approach to tariffs on energy products, should have resulted in a massively higher price down the curve and a major mess in the US gasoline prices in the US East Coast because the area is dependent on imports. But the market ignored the entire thing. This means that the US has reached the irrelevance stage. ‘They won’t implement what they said, they can’t,’ said a source in the Middle East, echoing what European and Asian sources said earlier. ‘They say one thing and then they change their mind,’ said the source.

In a major act of self-harm, the US administration paraded Energy Secretary Chris Wright in a Bloomberg TV interview where he stated there would be no tariff carve for US energy imports. Among other issues, this would totally harm the US in its jet requirements, some of which comes from Korea into the US West Coast, Gasoline into the US East Coast or all of its heavy crude oil refining industry. It would cause a major mess, sources concluded, calling it “madness.”

In the week ending 11 July 2025 exchange traded futures volumes rose w/w across all instruments and across the three front tenors, following the decline in traded volumes of the week ending 4 July. Brent and WTI saw the biggest increase in exchange trade volumes in the November contract, up 38.24% and 66.14%, respectively. Meanwhile volumes in September and October contracts for WTI jumped over 57% w/w.

Recurrent rumours of China stocking up crude for its national reserves were fuelled last week by a rising price and data indications that shipments from Iran and Iraq had gone up – as we reported yesterday, Vortexa also saw 600 kb/d more imports from Iran in June. Oil prices were buoyant but a belated acknowledgment by the general oil press noting the deluge of extra Saudi oil production cooled the exuberant feeling like an evening summer shower. And just as prices tanked back down towards the sub 70 mark, Energy Aspects drew further attention to the alleged Chinese buying and estimated a surge in extra imports of around 785kb! Party time again, right? 🤣

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Boom boom, oil markets are zooming up and no major bombs going off anywhere… This must be Chinese purchasing, isn’t it. All indications are that China has been loading up. You gotta give it to them. They are flat price buyers and anything below or near $70/bbl looks good for China. Shippers say China has been busy with Iranian and also Iraqi barrels. A positive start to the week! While the stock market feels the hangover of Trump’s weekend tariff binge, with S&P 500 futures down 0.5%, Brent flat price boogied upwards in the afterparty, climbing to $71.50. The prompt spread enjoyed itself too and rose to a peak of $1.29 after the Asian close, hitting its highest since the end of the 12-day war. Not quite like the party going on in Crypto but good enough!

The bullish vibes had dissipated somewhat earlier this week but made a late comeback this afternoon. You could argue that the market is pricing an upcoming event. We keep digging. Flat price fancied another crack at $70, breaking through at 15:30 GMT. By the close, it had risen to $70.37/bbl, while the prompt spread reached $1.20. As we saw in this morning’s allocations, China can’t stop buying, the Saudi OSPs were bullish too! We can’t help but feel we are at a turning point.

51 mil bbl crude oil Saudi allocation to China stuns the market! That’s the biggest monthly allocation since we began publication of The Officials – and even in recent memory beyond that! That’s up 4 mil bbl, with all except Unipec receiving a repeat of previous month’s allocations – and Unipec’s surged from 11 mil bbl to 15 mil bbl! “Why are they doing that?” asked another refiner. A source speculated Unipec is selling more oil into tea pots and another said that oil and premiums for oil loading in August are still ‘cheap,’ when compared with those forecasted for September.

OPEC made the most of its mega seminar to launch its World Oil Outlook, amidst a market downward correction. Talk about timing! The market fell more than $1 and is showing signs of exhaustion, whatever that is🤣. It’s just a bit sad that there were hardly any reporters there to comment on it! Or only the ones that dare not question the fakery. OPEC took the opportunity to dunk on the IEA’s forecast of peak global oil demand by the end of the decade, seeing world oil demand growing by 19.2 mil b/d to 122.9 mil b/d by 2050, despite seeing the OECD losing 8.5 mil b/d of demand! But really if nobody knows what production and demand are currently how can anyone say they know what will happen in 25 years. This is an exercise in nonsense. OPEC expects transport to play the biggest part in boosting global demand over the next 25 years. Underestimate NEV development at your peril! Read Asia 2.130 report for an update on their rampage through the market.

Chinese sources report that the Saudis are increasing allocations to the country by 3 mill barrels to 50 million in August. This would be normally bearish but the OPEC PR machine came with the nonsense that production quota increases would be paused from October. But since quotas are fakery to begin with, we advise the reader to focus on the actual production volumes. Flat price jumped on the reports but immediately fell back to its lowest point of the day, below $69.50.