The Officials

Flat price keeps going! $67 was a tempting target as Brent climbed this morning, stretching out its fingers to reach that elusive level. It brushed $67 at 13:45 BST and another during the window, but failed to gain a toehold and came to the European close at $66.92/bbl. We’ve been bullish for a few weeks now and the market’s finally waking up to the fact OPEC quota hikes don’t equate to supply increases.

Some OSPs bring joy, others bring pain. Joy for consumers ready to gobble up cheap crude, against pain of producers squeezed by low prices. The Murban/Dubai debacle had ADNOC up in arms, frustrated its ‘most valuable’ grade was setting the benchmark, pricing below the heavier, sourer Upper Zakum. For July, Murban is set at $63.62/bbl, down over 4 bucks from June pricing, with Upper Zakum set at a 10c premium, Das at Murban -55c and Umm Lulu at Murban +15c. The 10c UZ/Murban inversion is minor stuff compared to the downward flat price correction. This is real money! Imagine you produce 4 mil b/d and export 3 mil b/d, (this is just illustrative) but this would mean $12 million less revenue per day or $360 mil less per month. We’ll be talking billions if the market doesn’t recover and persistent overproduction continues. You cannot overproduce and have no price impact. In other words: you can’t have your cake and eat it!

On the 81st anniversary of D-Day, the North Sea was sombrely quiet and there was not a great battle among the traders. But the longs were definitely winning in the flat price front. Brent hit triple six for a while, $66.6+ something. The window players look fatigued after a busy week; Totsa and Mercuria were back, bidding for Midland yet again, bringing bids of +$1.45 and +$1.65 over dated. The sellside was also populated by the usual suspects, as BP and Phillips offered again, bringing +$2.00 and +$2.10 over dated to the table. But neither side wanted to budge much further, and no one traded.

Rome is burning! Brutus, Cassius, Judas… they’re all out for revenge. The knives are out and everything’s fair game! Reality TV soap operas can’t come close to this level of drama. We wouldn’t blame the US’ global rivals for warming their feet by the fire with a massive bucket of popcorn watching this one go down. The political schism is of monumental scale and could rip the American political scene asunder! As chaos engulfs the US political scene, oil remains largely unchanged, with August Brent still firmly anchored to $65, on a steady downtrend through today’s Asian session.

Trump’s phones are busier than a teenager’s as he calls his bros one after the other. Or are they rivals, despair not, a deal is in work or not. He first called Putin about the Russia/Ukraine war and today Xi to talk about the US-China trade war. Bessent said trade talks had stalled and stagnated and suggested the two biggest wigs should talk directly to iron things out. The call gave the market some good vibes and Brent flat price jumped to near $65.80 in the aftermath – it wasn’t just oil, either, as equity futures jumped on the news (though quickly sold off) and gold dropped some of its gains made in early trading.

Brent was on a sideways run though today’s Asian session, before climbing again to above $65, though it slipped to the close at $64.93/bbl. The futures structure is creaking under the pressure of headline extra supply and lukewarm demand prospects. The reality is far more complex but few understand that any headline about OPEC supply increase is fake. We mentioned yesterday that the Dec/Jan spread had returned to backwardation but it keeps flitting back and forth with contango, while the front spread is being ground down towards 60c, having started the month near 80c.

The Saudis know how to build the tension! They had us waiting a while into the afternoon for the July OSPs. A 20c cut on the month for Arab Light to Asia – the same for Extra Light, while Medium got a 10c cut and Heavy held steady from the June OSPs. Hey, Arab Heavy is the good stuff they need for the summer burn, so no need to discount it! The cuts to Asian OSPs were slightly less than the month on month change on the Dubai backwardation structure implied, and perhaps the Saudis also considered the shenanigans in the Dubai market and the impact from the weak Murban during May trading. The Saudis also took some of the cash that they so generously gave in previous months; we noticed they had frequently set OSPs slightly below where structures had implied in recent months.

Middle Eastern Official selling prices (OSPs) are to be issued later in the day and ahead of the region’s religious holidays. We wish everyone celebrating a restful period from Asia through the Middle East to Europe and the Americas. Keep an eye on the X/Twitter account (@OnyxOfficials), where we will release the OSPs as soon as we get them. A quick survey of market participants by The Officials showed market opinion is divided: most agree on some degree of cut (referring to Arab Light to Asia), but the degree is split between a few cents to as much as -40c from the June price. The change in Dubai structure implies a cut around 35-40c…

$65 is sticky! Brent flat price – even after the July contract’s expiry – can’t get away from it! It spent today fluctuating either side of that mark, stuck in a tight range as the market appears to wait patiently to wake it from its slumber. Even Don Taco just has traders guessing which way to go…

In the week ending 30 May 2025, exchange traded futures volumes in Brent, Gasoil, Heating Oil, RBOB and WTI front month contracts declined w/w -with Brent futures falling over 61% heading into expiry on Friday. Brent and RBOB future volumes rose in the August tenor w/w; in September Brent future volumes moderately dropped w/w; whereas RBOB volumes soared almost 36% compared to the week before. By contrast, volumes in Gasoil, Heating Oil and WTI futures decreased across the board.

Today marks the anniversary of the first Issue of The Officials. Since 3 June 2024, we have published 543 Issues: Asia edition (250), European edition (252), Liquidity Report (16) and Editorial/Special Reports (25). The publication of physical assessment such as Dubai, Dated Brent and key market indicators such the Officials Brent Index (OBI) have generated great interest among our readers and exchanges. The publication of swap valuations has also proven helpful to our community. Our readers need easily accessible low-cost markings. We have now completed a full year of Dubai, Brent and derivatives assessments as well as newer benchmarks for Bitcoin, gold, currency indices and Dated Brent assessments.

The first Dubai window of June may have been silent, but the North Sea was anything but! Totsa stormed in early on to bid for a whole range of mid- to late-June Midland cargoes. Mercuria came in bidding for Midland too, while BP, Shell and Repsol all offered. An eruption of interest! Like Etna in Sicily. Totsa got lucky, as Repsol sold it a 16-20 June cargo at Dated +$1.60, while BP and Vitol each hit one 26-30 June Midland to Totsa at $1.90 over Dated! Just one more with those dates will net Totsa a VLCC… After such a busy first June window, the physical differential zoomed up to 61c!

A new dawn, a new month, a new window? Maybe but nobody can decide just yet. Not a single trade in June’s first Dubai window, as the players got all cagey and didn’t want to take the bull by the horns. The Taureau was back but looked rather solitary as a bidder, not raising too aggressively and lacking support on the buyside. PetroChina had been the primary buyer in May but today decided to try its hand at both bidding and offering, though it seemed more committed to the sellside and withdrew its bid well before the close. The sellers were more numerous – Unipec, Reliance, Hengli and BP among them – and, without anybody seizing responsibility on the buyside, the physical premium (now reflecting June/August) fell to $1.31. But on an implied basis the premium closed the month in May at 77c.

It has been a good year of publishing for The Officials. And what a year it has been: 2+ million reads, a deal with Jakarta Futures Exchange signed, a new Liquidity Report, a full year of Dubai assessments and four months of Dated Brent. And before we forget, our presence in Dubai continues to grow. Oh, the juicy bits we hear here. A great place and very welcoming! We’ve reached the end of our 12th month of publication. We have a lot of data and if you need to contrast and compare, just call or email us. We are here to help you!

It has been a good year of publishing for The Officials. And what a year it has been: 2+ million reads, a deal with Jakarta Futures Exchange signed, a new Liquidity Report, a full year of Dubai assessments and four months of Dated Brent. And before we forget, our presence in Dubai continues to grow. Oh, the juicy bits we hear here. A great place and very welcoming! We’ve reached the end of our 12th month of publication. We have a lot of data and if you need to contrast and compare, just call or email us. We are here to help you!