Distillates

The Mar’25 Brent futures contract experienced a weaker afternoon, trading down from $78.16/bbl at midday to $76.76/bbl, where it trades at the time of writing (17:30 GMT) as concerns surrounding oil supply disruptions from Colombia eased. In headlines, Iraq’s Rumaila oilfield, its largest and one of the most productive in the world with a capacity of 1.5 mb/d has seen its output cut by 300 kb/d following a fire at the field last week. The incident occurred in a decommissioned storage tank at the fifth gas separation station (DS5) in northern Rumaila and was reportedly caused by “unidentified technical reasons,” according to the Iraqi oil ministry. Iraq currently has no timeline for restoring full production. Rumaila, operated in partnership with BP and PetroChina, accounts for roughly a third of Iraq’s total crude output, which has risen by 40% since 2010. In other news, teapot refiners in the Shandong province are under increasing financial pressure as new tariffs on imported feedstock came into effect on January 1, 2025. The import tariff on fuel oil was raised from 1% to 3%, while rebates on consumption taxes were reduced, significantly increasing operating costs. Many of these refiners, which lack sufficient crude import quotas, rely on fuel oil imports to produce transportation fuels like diesel and gasoline. Already struggling with narrow margins amid weak domestic fuel demand, at least four refiners have halted or plan to suspend operations indefinitely for maintenance. The Mar/Apr’25 and Mar/Sep’25 futures spreads have fallen to $0.84/bbl and $3.63/bbl, respectively.

The Mar’25 Brent futures contract softened from $78.90/bbl at 1300 GMT to a low of sub-$78.00/bbl levels at 1615 GMT before rising to around $78.20/bbl at 1725 GMT (time of writing). Crude and gasoline prices dropped to two-week lows today, showing moderate declines. Crude oil faced pressure following remarks from Russian President Vladimir Putin, who expressed willingness to discuss Ukraine and oil prices with President Trump, reducing concerns about potential additional US sanctions on Russian crude. Shell is set to report a lower annual profit for 2024, impacted by weak oil prices and declining demand for fossil fuels. The company is expected to announce earnings of £24.1 billion, down from £28.3 billion in 2023. The US Dollar Index dipped below 107.50 on Friday, facing intraday losses and a five-week low after US President Trump raised doubts about applying tariffs on China following a call with President Xi Jinping. The Bank of Japan’s 25 basis point rate hike significantly weakened the USD against the Japanese Yen (JPY). Union Minister Hardeep Singh Puri stated today that India will continue purchasing discounted crude oil from Russia, emphasizing the government’s commitment to securing economically priced oil. He noted that India’s imports from Russia have risen from 0.2% in February 2022 to 30%. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.90/bbl and $3.79/bbl, respectively.

The Mar’25 Brent futures contract initially saw strength this afternoon, steadily climbing to $79.60/bbl around 1515 GMT, however, prices sold-off shortly after 1610 GMT down to $78.10/bbl at 1640 GMT, retracing to $78.65/bbl at 1735 GMT (time of writing). Crude oil prices faced bearish sentiment after US President Trump urged OPEC to lower oil prices and reiterated his tariff threats, as per Bloomberg. Trump also pledged to ensure Europe’s energy security while asserting that the US no longer needed Canadian oil and gas. Meanwhile, EIA data released today at 1700 GMT for the week to 17 Jan showed that US crude oil inventories fell by 1.02mb. In the news today, Donald Trump’s tariff threats aimed at strongarming Russia into ending the war in Ukraine have been badly received by some Russian politicians, with Sergei Markov, a former Kremlin adviser, stating Trump’s actions suggested he would not be able to bring peace to Ukraine, according to Reuters. In other news, a large part of Russia’s oil tanker fleet is being forced to change the flag they sail under after pressure from US and UK sanctions, as per Bloomberg. The Barbados ship registry said that by the end of January it will have asked 46 ships to remove the country’s flag as a result of the sanctions, while Panama’s ship registry said earlier this month it had begun to de-list 68 US-sanctioned vessels. In macroeconomic news, US jobless claims data released at 1330 GMT today edged higher to 223k, compared to a forecast of 221k. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.78/bbl and $3.69/bbl, respectively.

After this morning’s strength, Mar’25 Brent futures declined from just under $79.90/bbl at 1120 GMT down to this afternoon’s low of $78.87/bbl at 1500 GMT, recovering to $79.45/bbl at 1750 GMT (time of writing). Crude oil prices saw bearish sentiment amid waning geopolitical risk, with the Israel-Hezbollah ceasefire likely to be extended beyond next week, as per Bloomberg. In the news today, US President Donald Trump said he would add new tariffs to his sanctions threat against Russia if the country does not make a deal to end the war in Ukraine, Reuters reports. Trump added that tariffs could also be applied to “other participating countries”, currently threatening a 10% tariff on China. In other news, Motiva’s 630kb/d Port Arthur refinery on the Texas Gulf Coast has shut multiple units due to winter storms. Meanwhile, the ports of Houston and Galveston remain shut as Freeport opens, as per Bloomberg. Finally, CNOOC said today that its net oil and gas production was about 720mb of oil equivalent for 2024, setting a record high for the sixth consecutive year. The company aims to maintain stable capital expenditure for 2025 while reaching a net production target of 760mb to 780mb. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.88/bbl and $4.17/bbl, respectively.

The Mar’25 Brent futures flat price clawed higher on Tuesday afternoon, rising from $78.50/bbl at 14:00 GMT to nearly $79.60/bbl by 16:45 GMT before falling to $79.16/bbl by 17:40 GMT (time of writing). In the news, a rare winter storm across the U.S. South has disrupted natural gas and oil production, strained the Texas power grid, and halted LNG exports. Despite the Houthis’ announced pullback, insurers remain reluctant to cover Red Sea transit due to ongoing security risks, delaying a full return to the Suez Canal route and keeping freight rates elevated, though a gradual decline is expected. Trump’s tariff threats on Canadian oil have widened the gap between U.S. and Canadian energy stocks, with Toronto-listed names underperforming as investors shy away from policy uncertainty, while analysts warn of further downside if tariffs are implemented. Serica Energy remains committed to investing in the UK North Sea despite high taxes, seeing opportunities in the market, but emphasises the need for a more sustainable tax regime to support long-term oil and gas development. U.S. energy mergers may slow in 2025 as deal sizes shrink due to fewer available targets and regulatory delays, but smaller and mid-cap producers are still expected to pursue M&A for scale, with cost-saving measures like longer laterals helping to improve drilling economics. Finally, the front (Mar/Apr) and 6-month (Mar/Sep) Brent futures spreads are at $0.81/bbl and $4.05/bbl respectively.

The Mar’25 Brent futures contract started to recover this afternoon, strengthening around 50c since this morning up to $80.93/bbl at 1325 GMT. However, Brent flat price then sold-off at US open (1330 GMT) down to $79.45/bbl around 1400 GMT, retracing to $80.08/bbl at 1750 GMT (time of writing). Crude oil prices have continued to decline as traders anticipate policy announcements from US President Donald Trump, including plans to boost domestic oil production and resolve the Russia-Ukraine conflict. In the news today, Chinese crude imports from Russia rose by 1% y/y to a record high of 2.17mb/d, data from the Chinese General Administration of Customs showed. Higher imports from Russia potentially demonstrate Chinese refiners’ appetite for cheap cargoes amid weak refining margins. Meanwhile, crude imports from Saudi Arabia dipped by 9% y/y to 1.57mb/d. In other news, Chevron has expressed interest in oil and gas exploration offshore Greece, the Greek Ministry of Energy and Environment stated today. Greece said that it would imminently announce an international tender and decide on the particular area designated for exploration this week. Finally, the cost to hire an oil supertanker on key routes to China has doubled since the newly imposed US sanctions on Russia, as per Bloomberg. Daily rates for VLCCs on the Middle East-to-China route (TD3C) surged 112% to $57.6k in the week to 17 Jan, while rates on the US Gulf-to-China route (TD22) soared 102% to around $55.5k. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.99/bbl and $4.70/bbl, respectively.

The Mar’25 Brent futures contract weakened further this afternoon, falling from $81.35/bbl at 1200 GMT down to $80.57/bbl at 1600 GMT, before recovering to $81.15/bbl at 1755 GMT (time of writing). Crude oil prices have faced some downward pressure as geopolitical tensions in the Middle East ease, following Israel’s security cabinet’s approval of the Gaza ceasefire deal. In the news today, China’s oil refinery throughput in 2024 saw its first decline in over two decades excluding 2022, as refineries scaled back operations amid stagnant fuel demand and weak margins. Throughput dropped 1.6% year-over-year to 14.13 million barrels per day. In other news, a Reuters review of US sanctions showed six Russian oil tankers still under construction were included, the first time Washington is known to have banned tankers before they set sail. In addition, Russia’s exports of refined oil products fell by 9.1% y/y in 2024 to 113.7 million metric tonnes amid drone attacks on refineries and export bans. Finally, Italy’s natural gas consumption fell for a third consecutive year in 2024, dropping by 2.5% to the lowest level in more than 15 years, power market manage GME stated. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $1.21/bbl and $5.37/bbl, respectively.

Mar’25 Brent futures saw oscillating price action this afternoon, increasing from $81.20/bbl at 1230 GMT to nearly $82.00/bbl at 1425 GMT, before falling to $80.45/bbl at 1630 and recovering to $81.45/bbl at 1745 GMT (time of writing). In the news today, a strategic cooperation agreement between Russia and Iran will not include a mutual defence clause like those Russia has signed with North Korea and Belarus, according to TASS citing an Iranian envoy. In other news, advisers to President-elect Donald Trump are readying a wide-ranging sanctions strategy to facilitate Russia-Ukraine diplomacy in coming months while at the same time squeezing Iran and Venezuela, Bloomberg reported. One set of policy recommendations suggested good-faith measures to benefit sanctioned Russian oil producers, on the condition that an end to the Ukraine war is in sight. Meanwhile, a second recommendation proposed to ramp up pressure by building on the sanctions. In addition, Scott Bessent said the US is poised to increase sanctions on Russian oil companies to force them to the negotiating table with Ukraine, according to Financial Times. Finally, BP plans to cut some 4,700 jobs and 3,000 contractor roles this year to reduce costs, the supermajor told Reuters. These cuts would be equal to around 5% of the global workforce of around 90,000 employees at BP, aiming to cut at least $2 billion in costs by 2026. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $1.40/bbl and $5.72/bbl, respectively.

The Mar’25 Brent futures contract saw steady strength this afternoon, rising from just over $80/bbl at 1200 GMT up to this afternoon’s high of $81.60/bbl at 1630 GMT, moderating to $81.40/bbl at 1745 GMT (time of writing). EIA stats released at 1530 GMT for the week ending 10 Jan showed a lower-than-expected draw of 1.96mb in US crude oil inventories. In the news today, Israel and Hamas have agreed to a Gaza ceasefire deal, centred on the release of Israeli hostages for Palestinian prisoners, as per Bloomberg. The deal outlines a six-week initial ceasefire phase and includes the gradual withdrawal of Israeli forces from Gaza, according to Reuters. In other news, Russia targeted Ukrainian gas infrastructure and other energy facilities today, with President Zelenskyy claiming Russia launched over 40 missiles during a morning attack and more than 70 drones overnight. Ukraine’s oil and gas company Naftogaz said there were no outages and “gas supplies to population were uninterrupted”, while the Russian Defence Ministry claimed their attacks successfully hit all designated targets on energy facilities. Finally, OPEC has released its latest Monthly Oil Market Report, forecasting global oil demand to expand by 1.4mb/d in 2025. OPEC projects OECD oil demand to grow by about 0.1mb/d while non-OECD is forecast to increase by 1.3mb/d, with this rate of growth expected to continue in 2026. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $1.27/bbl and $5.34/bbl, respectively.

The Mar’25 Brent futures contract saw some weakness this afternoon, declining from almost $80.90/bbl at 1200 GMT down to $80.15/bbl at 1800 GMT (time of writing). In the news today, Kaja Kallas, the EU’s foreign policy chief is now pushing for the European Union to lower the $60/bbl price cap on Russian oil, Kallas told Bloomberg in an interview. In other news, swarms of Ukrainian drones attacked energy and military facilities across central Russia and the Volga region overnight, according to a Ukrainian Security Service official. Drones set Rosneft’s PJSC Saratov oil refinery on fire as well as two chemical plants in the Tula and Bryansk regions, according to Bloomberg. Finally, Peru’s Bretana crude oil is gaining popularity in the US, with the first cargo discharging in the US Gulf Coast this month as US refiners seek alternatives to Mexican heavy crude, as per Reuters. Kpler and LSEG ship tracking data showed a vessel transported about 300kb of Bretana from Brazil to Houston on 2 Jan, with the cargo bought by oil major Shell. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $1.11/bbl and $4.76/bbl, respectively.

The Mar’25 Brent futures contract ultimately saw weakness this afternoon amid rangebound price action, seeing a decline from around $81.10/bbl at 1200 GMT down to this afternoon’s low of $80.37/bbl at 1425 GMT, before recovering to $80.90/bbl at 1745 GMT (time of writing). In the news today, an Indian government source said the country has halted trade with US-sanctioned Russian companies and tankers, but the country does not expect disruption to Russian crude supplies for a two-month wind-down period, Reuters reports. In other news, the German government is considering selling its entire 99.12% stake in the $18.8 billion energy company Uniper, however, wishes to pursue a partial stake sale of around 25% as a preferred option, as per Reuters. Parties that have been approached about a full sale include New York-headquartered Brookfield. Germany’s Finance Ministry have yet to reveal a timeframe or structure for the potential deal. Finally, the Russian Defence Ministry claimed on Telegram that Ukraine attempted a drone attack on TurkStream gas pipeline this weekend, sending nine drones to hit the Russkaya compressor station in the Russian region of Krasnodar, with no damage reported. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $1.35/bbl and $5.52/bbl, respectively.

Strength in the Mar’25 Brent futures contract continued this afternoon, seeing a significant rally from around $78.80/bbl at 1100 GMT up to $80.65/bbl just after 1430 GMT, before falling back down to $79.25/bbl by 1750 GMT (time of writing). This afternoon saw bullish sentiment as crude oil prices reached $80 per barrel for the first time since October, coinciding with the US expanding its sanctions on Russia and Venezuela. The measures against Russia include sanctions on Gazprom Neft and Surgutneftegas, and the blacklisting of 183 vessels involved in Russian energy exports, according to Financial Times. Meanwhile, the sanctions on Venezuela targeted state oil company PDVSA chief Hector Obregon and eight Venezuelan officials in President Nicolas Maduro’s government, as per Reuters. These measures come alongside UK and EU sanctions aimed at fifteen additional Venezuelan officials. In other news, oil refiners in India and China have increased crude purchases from the Middle East and Atlantic Basin amid concerns of limited Russian and Iranian supply, according to Bloomberg. Two Indian refiners bought up to 6mb of Oman and Murban crude this week for February loading, while Indian Oil Corp bought up to 2mb of WTI Midland. Finally, US non-farm payrolls released at 1330 GMT today showed a 256k increase in jobs in December 2024, the highest in nine months and much larger than the forecast of 160k. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.92/bbl and $3.97/bbl, respectively.

The Mar’25 Brent futures contract has seen steady support this afternoon, increasing from around $76.40/bbl at 1200 GMT up to $77.20/bbl at 1725 GMT (time of writing). In the news today, Saudi Arabia’s crude oil supply is set to decline in February m/m, with Saudi Aramco projected to ship about 43.5mb of crude oil to China, down from January’s 46mb. China’s state majors CNOOC and PetroChina are expected to lift less crude in February while Aramco is set to increase its supply to Sinopec and Sinochem, according to a Reuters report. In other news, after BP was hired as a technical service provider for India’s largest oifield, Mumbai High, the British major stated that crude oil output at the offshore field could be increased by 44% from a baseline production of 45.47 million metric tonnes to 65.41 over the ten-year contract period. According to India’s ONGC, the increase is expected to be visible from FY’26 with full scale visibility expected from FY’28. Finally, in the leadup to President-elect Trump’s inauguration on 20 January, the US Senate energy committee will hold nomination hearings for energy roles on Tuesday and Wednesday (14-15 Jan) next week, as per Reuters. The committee will hold a hearing for Doug Burgum for secretary of the interior and Chris Wright for energy secretary, two candidates who are both expected to carry out Trump’s policies to boost production of oil and gas. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.67/bbl and $2.82/bbl, respectively.

After reaching nearly $77.90/bbl this morning, the Mar’25 Brent futures contract has weakened this afternoon, selling-off from $77.50/bbl around 1300 GMT down to $76.25/bbl at 1730 GMT (time of writing). Crude oil prices saw bearish sentiment alongside the release of EIA data at 1550 GMT today, which showed a lower-than-expected draw of 959kb in US crude oil inventories for the week ending 03 Jan, compared to a forecasted draw of 2mb. In the news today, the Ukrainian military said it set fire to a Russian oil depot which provided fuel to the Engels-2 military air base containing Russian nuclear bomber planes, as per Reuters. Meanwhile, a Russian regional governor Roman Busargin stated that a fire caused by a “mass drone attack” had broken out in Engels at an industrial site, which he did not name. In other news, India’s state-owned Oil and Natural Gas Corporation (ONGC) has hired BP to be the technical services provider at their Mumbai High oilfield, a move aimed at identifying improvements in the facilities to boost crude production. The oilfield hit a peak oil production of 471kb/d in March 1985, with output declining to around 134kb/d as of last year. Finally, strong European demand for Guyana’s crude has pushed the country’s oil exports up by 54% to 582kb/d in 2024, according to Reuters citing LSEG shipping data. Since Guyana began exporting oil in early 2020, it is now the fifth largest Latin American crude exporter after Brazil, Mexico, Venezuela, and Colombia. Finally, at the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.62/bbl and $2.63/bbl, respectively.

The Mar’25 Brent futures contract strengthened above $77/bbl at noon GMT today, where it met resistance and softened to $76.70/bbl at 14:15 GMT. Since then, the benchmark crude futures contract has continued to oscillate between these ranges, seeing resistance at $77.15/bbl and support at $76.65/bbl, and stands at $76.95/bbl at 17:30 GMT (time of writing).

After seeing strength this morning, the Mar’25 Brent futures continued to rise from $76.80/bbl at 1200 GMT up to $77.50/bbl at 1515 GMT, before declining to $76.30/bbl at 1740 GMT (time of writing). In the news today, the Biden administration has banned oil drilling in large coastal areas ahead of President-elect Trump’s inauguration. President Biden is issuing two Presidential Memoranda to protect more than 625 million acres off the East and West coasts, including the eastern Gulf of Mexico and parts of the Bering Sea in Alaska, indefinitely prohibiting these areas from federal offshore oil and gas leasing. In other news, Sudan has lifted a nearly year-long force majeure on pipelines transporting South Sudan’s oil through Sudan to the Red Sea, Reuters reported citing a letter from Sudan’s Energy Ministry. South Sudan’s crude exports reached an annual peak of 186kb/d in January 2024, falling to 58kb/d by December 2024, according to tanker tracking data compiled by Bloomberg. Finally, India’s SPR is looking to expand its inventories, having issued a notice to private firms inviting them to bid for a storage site of 2.5 million metric tonnes at Padur, according to Reuters. India’s underground SPR storage has a total approximate capacity of 5.33 million metric tonnes of crude oil, as per India’s Ministry of Petroleum and Natural Gas. At the time of writing, the Mar/Apr ’25 and Mar/Sep ’25 Brent futures spreads stand at $0.62/bbl and $2.61/bbl, respectively.

After seeing weakness this morning, the Mar’25 Brent futures contract recovered this afternoon, increasing from $75.60/bbl at around 1100 GMT up to $76.60/bbl at 1730 GMT (time of writing). In the news today, Venezuela’s oil exports rose 10.5% y/y in 2024 to an average 772kb/d, with exports to the US soaring 64% to 222kb/d last year, according to data compiled by Reuters. A large share of the year’s export gains came from Chevron’s shipments of Venezuelan crude to the US under a license in place since early 2023. In addition, Venezuela’s crude exports to China were down 18% y/y to 351kb/d, while exports to India jumped to 63kb/d this year from just over 10kb/d in 2023. In other news, China’s CNPC is expected to boost crude production capacity at its West Qurna 1 oilfield in Iraq from the current 550kb/d capacity to 800kb/d by 2028 and 1.2mb/d by 2035, the project’s subsurface manager Cai Kaiping stated. Finally, Middle Eastern crude oil grades strengthened in the final week of December on robust demand from Asian refiners and limited flows of Iranian and Russian barrels, as per Bloomberg. In late-December, Oman crude futures and partial lots of Dubai crude were priced at $1 or more over Brent, surging to a rare premium to the North Sea crude. At the time of writing, the Mar/Apr ’25 and Mar/Sep ’25 Brent futures spreads stand at $0.62/bbl and $2.70/bbl, respectively.

The Mar ’25 Brent futures contract continued to see support this afternoon as it rose from around $75.70/bbl at mid-day to $76.40/bbl at 17.15 GMT (time of writing). China’s manufacturing PMI dipped to 50.5 in December, missing forecasts, as output slowed and export orders shrank amid weak demand and tariff risks. While services and construction showed improvement, this weaker data could prompt the government to boost stimulus measures. Iran’s Deputy Foreign Minister, Majid Takht-Ravanchi, is visiting India for talks on resuming energy trade, which has plummeted since US sanctions in 2018 forced Indian refiners to stop buying Iranian oil. Bilateral trade fell from $17 billion in 2018-19 to $2.3 billion in 2022-23. US crude oil stocks decreased by 1.18 mb for the week ending 27 Dec, compared to a 4.24 mb drop the previous week and below the forecasted decline of 2.75 mb, according to the EIA. The latest Dallas Fed Energy Survey showed Dallas’ energy sector grew in Q4, with activity rising to 6.0 from -5.9 in Q3 and outlook improving to 7.1. Oil production was steady, while gas production edged lower. At the time of writing, the Mar/Apr ’25 and Mar/Sep ’25 Brent futures spreads stand at $0.49/bbl and $2.40/bbl, respectively.

The Mar’25 Brent futures contract was initially supported around the $74.50/bbl level this morning at 0800 GMT, before falling to $73.90/bbl at 1310 GMT (time of writing). In the news today, a Ukrainian drone attack in western Russia caused a fuel spill and fire at an oil depot according to Vasily Anokhin, the governor of Russia’s Smolensk region. Meanwhile, Gazprom said that it would pump a reduced volume of gas to Europe via Ukraine today, as per Reuters. This comes as the Ukrainian gas transit deal is expected to expire on 1 January, following Russian President Vladimir Putin’s 26 Dec statement that there was insufficient time this year to negotiate a new agreement. In other news, Iran has appointed Ali-Mohammad Mousavi as its representative to OPEC, replacing Afshin Javan. Mousavi currently serves as Deputy Minister for International Affairs and Commerce at the Iranian Oil Ministry. Finally, President Xi Jinping said in a speech today that China’s 2024 GDP growth is projected to expand around 5%, reported by Xinhua. According to Bloomberg, economists forecast an expansion of 4.8% for China’s GDP this year. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.41/bbl and $1.94/bbl, respectively.

The Mar’25 Brent futures contract rose this afternoon, from under $74.00/bbl at mid-day to $74.45/bbl at 1715 GMT. US SPR crude inventories increased by about 0.3mb last week, reaching 393.6mb. Sour crude rose by 0.3mb to 250.3mb, while sweet crude remained unchanged at 143.3mb. Nigeria’s state-owned National Petroleum Company announced that its second refinery in Warri, located in the southern region, is now operational. The 125 kb/d refinery, under a $898 million rehabilitation since 2021, is now running at 60% capacity, focusing on kerosene, diesel, and naphtha production, according to NNPC CEO Mele Kyari and the presidency. Iran’s non-oil exports surged 18% to $43.14 billion in the first nine months of the Iranian calendar year, driven by a 33% rise in petrochemical exports, totalling $19.7 billion. Export volumes grew 13.77%, while imports reached $50.89 billion, with higher per-ton values despite a drop in weight. China remained the top export market, followed by Iraq, the UAE, and Turkey. The Chicago PMI dropped to 36.9, signalling a deeper-than-expected contraction in the region’s manufacturing sector and potential bearish pressure on the US dollar. This was well below the forecast of 42.7, indicating a sharper slowdown than anticipated. At the time of writing, the Mar/Apr’25 and Mar/Sep’25 Brent futures spreads stand at $0.45/bbl and $2.07/bbl, respectively.

The Mar’25 Brent futures contract witnessed a rangebound afternoon, oscillating between $73.30/bbl and $73.70/bbl, and currently sits at $73.40/bbl at 17:20 GMT (time of writing).

The Mar’25 Brent futures flat price saw a volatile and choppier performance amid thinner liquidity on Tuesday, rising to $73/bbl by 11:20 GMT before selling off by 60c within 15 mins, and is printing $72.74/bbl at 13:15 GMT (time of writing). With trading volumes quieter during the holiday period, price action is expected to fluctuate around current levels in the short term, with traders in a tentative and wait-and-see mode ahead of the new year. In the news, Russian President Vladimir Putin has lifted a 2022 ban on transactions involving Rosneft shares, paving the way for potential sales, including stakes in German refineries, amid ongoing sanctions challenges and interest from Middle Eastern investors. Indian state refiners may turn to Middle Eastern spot crude to offset an 8-10mb shortfall in Russian oil for January, driven by rising Russian domestic demand and OPEC commitments, potentially raising costs due to less favourable economics. Indian Oil Corporation will invest 610 billion rupees ($7 billion) in a naphtha cracker project in Paradip, Odisha, with an initial agreement expected to be signed in January, complementing its existing 300kb/d refinery in the region. Finally, the front (Feb/Mar) and 6-month (Feb/Aug) Brent futures spreads are at $0.40/bbl and $1.92/bbl respectively.

The Feb’25 Brent futures flat price continued to slide on Monday afternoon, falling from the $72.70/bbl level at 11:00 GMT to $72/bbl by 16:50 GMT, before finding technical support and bouncing up to $72.12/bbl by 17:20 GMT (time of writing). In the news, India’s crude imports in November saw Middle Eastern oil rise to a 9-month high, accounting for 48%, while Russian oil fell to its lowest share in three quarters at 32%, driven by refinery maintenance and adherence to Middle Eastern supply contracts. Efforts to broker a Gaza ceasefire have gained momentum, with progress on key issues like prisoner exchanges and troop deployment, but major sticking points, including the duration of the ceasefire and the broader terms for ending the war, remain unresolved amid dire humanitarian conditions in the region. According to an EIA article, improved operational efficiency and technological advancements have enabled U.S. crude oil production in the Lower 48 states to reach a record 11.3 mb/d in November 2024, despite a declining rig count, with productivity per rig expected to rise further in 2025 due to continued innovation and new pipeline capacity. US SPR crude inventories rose by 0.3mb w/w to 393.3mb last week. Finally, the front (Feb/Mar) and 6-month (Feb/Aug) Brent futures spreads are at $0.29/bbl and $1.55/bbl respectively.

Feb’25 Brent futures failed to break through support at $72.00/bbl throughout this afternoon and rose to $73.00/bbl at 1720 GMT (time of writing). Kremlin spokesman Dmitry Peskov warned that potential G7 sanctions on Russia’s oil industry could destabilise global energy markets and prompt Russian countermeasures. Proposed measures include reducing the price cap on Russian oil from $60 to $40/bbl or banning its transportation and insurance, though no decision has been finalised. According to data from China’s General Administration of Customs, Russia increased oil exports to China by 1.65% year-on-year to 99 million tons from January to November, valued at $57.4 billion (+4.7%). The EIA forecasts U.S. energy consumption rising from 93.69 qBtu in 2023 to 95.15 qBtu in 2025, with liquid fuels averaging 20.29 mb/d in 2024 and 20.53 in 2025 and natural gas at 90.5 and 90.2 billion cubic feet/day, respectively. Russia remains China’s top oil supplier, followed by Saudi Arabia and Malaysia. Presidents Putin and Xi emphasised strengthening energy cooperation during their May meeting. At the time of writing, the front (Feb/Mar’25) and 6-month (Feb/Aug’25) Brent Futures spreads are at $0.39/bbl and $1.89/bbl, respectively.

Feb’25 Brent futures fell from $73.70/bbl at 13.30 GMT to $72.70/bbl at 17:00 GMT. A US government shutdown is looming as Congress scrambles to pass a stopgap bill, despite opposition from President-elect Donald Trump, according to Fox News. Economic data showed jobless claims dropped to 220,000 (below estimates) from 242,000 the previous week. US GDP saw annualised growth of 3.1% in Q3, and the Philadelphia Fed survey plunged to -16.4, compared to the predicted +3.0. BP and Iraq have agreed on key technical terms for redeveloping Kirkuk’s oil and gas fields, which still contain billions of barrels of recoverable oil. According to BP, a full contract is expected to be finalized by early next year. Oil operators in North Dakota, the third-largest oil-producing state in the US, are still working to restore facilities after October wildfires impacted key production areas. The fires caused a loss of 520kb and a decline in output to 1.178 mb/d from 1.2 mb/d in September. According to Sinopec, China’s oil consumption is projected to peak by 2027 at 800 million metric tons, equivalent to 16 million barrels per day. They say the decline in diesel and gasoline demand is driving the slowdown in the world’s largest oil importer. At the time of writing, the front (Feb/Mar’25) and 6-month (Feb/Aug’25) Brent Futures spreads are at $0.40/bbl and $1.78/bbl, respectively.

The Feb Brent Futures contract has seen mixed price action this afternoon, trading up to a high of $74.12 at 16:10 GMT before retracing to $73.61/bbl where it sits at the time of writing, as EIA data highlighted that crude inventories fell by 934kb to 421mb in the week, compared with analysts’ expectations in a Reuters poll for a 1.6mb draw. In headlines, Saudi Arabia’s crude oil exports rose to a three-month high in October, reaching 5.92 mb/d, up 174 kb/d from September, according to JODI data. Despite the increase in exports, crude production slightly declined to 8.972 mb/d as the Kingdom adhered to its pledge to produce “around 9 mb/d.” Meanwhile, Barclays downgraded the energy services sector from positive to neutral, citing a bearish oil macro environment, limited investor capital influx, and potential risks to 2025 earnings. The sector, after three years of double-digit growth, is now experiencing a mid-cycle spending plateau. At the time of writing, the front (Feb/Mar’25) and 6 month (Feb/Aug’25) Brent Futures spreads are at $0.38/bbl and $1.64/bbl, respectively.

The Feb’25 Brent futures flat price came off from the $73.20/bbl handle on Tuesday afternoon. Price action fell to lows of $72.50/bbl before recovering to $72.88/bbl by 17:20 GMT (time of writing). In the headlines, the UK imposed new sanctions on two oil trading firms, 2Rivers DMCC and 2Rivers Pte Ltd, and 20 shadow fleet vessels to curb Russian oil revenues and disrupt its illicit oil trade. Oil has washed ashore tens of kilometres of Russia’s Black Sea coast after two aging tankers were damaged in a storm, and now a third tanker has issued a distress signal, heightening fears of a worsening environmental disaster. Saudi Arabia has successfully extracted lithium from oilfield brine and plans to launch a commercial pilot program led by Lihytech, showcasing its move toward alternative wealth sources amid rising global demand for battery minerals. Kazakhstan has downgraded its 2024 oil output forecast to 87.8 million tons, citing maintenance at the Tengiz oilfield, with production totalling 80.5 million tons from January to November. Finally, the front (Feb/Mar) and 6-month (Feb/Aug) Brent futures spreads are at $0.32/bbl and $1.41/bbl respectively.

The Feb’25 Brent futures flat price traded within a 60c range on Monday afternoon. Price action reached highs of $74.30/bbl at 15:30 GMT before falling to $73.74/bbl at 16:30 and climbed to $74.11/bbl by 17:30 (time of writing). In the news, the EU has adopted its 15th sanctions package against Russia, targeting 52 new vessels from Russia’s shadow fleet, increasing the total number of such listings to 79. Shell and its partners will invest $5 billion in Nigeria’s Bonga North offshore oil project, expected to produce 110kb/d by the decade’s end, with 300 million barrels of oil equivalent recoverable from the area. According to a Bloomberg article, tanker rates for Middle East-China routes (TD3C) have fallen by a third this year due to weaker Chinese crude demand, driven by an economic slowdown, fuel-switching, and OPEC+ delays in restarting idled supply, impacting supertanker operators significantly. US SPR crude inventories rose by 0.5mb w/w to 393.0mb last week. Finally, the front (Feb/Mar) and 6-month (Feb/Aug) Brent futures spreads are at $0.38/bbl and $1.69/bbl respectively.

The Feb’25 Brent futures flat price initially saw a decline this afternoon from around $74.10/bbl at 12:00 GMT to $73.60/bbl at 14:05 GMT, before recovering to $74.40/bbl at 17:50 GMT (time of writing). Bullish sentiment has persisted as Russia launched an extensive aerial attack today on Ukraine’s power grid, using 93 missiles and nearly 200 drones, as per Reuters. Ukrainian officials stated six unspecified energy facilities were damaged in the western region of Lviv, in addition to serious damage to thermal power plants, according to DTEK, Ukraine’s largest energy provider. In other news, the presidential decree banning Russian companies from selling oil and petroleum products at the price cap set by the G7 countries has been extended until the end of June 2025, according to Russian news agency Interfax. Finally, US-based Kosmos Energy said it is in early preliminary discussions to buy Tullow Oil, with a view to potentially expanding their African oil assets. Kosmos currently has oil production and exploration assets in basins offshore Ghana and Equatorial Guinea, while Tullow Oil owns offshore production platforms in Ghana, Gabon and Cote d’Ivoire. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.39/bbl and $1.67/bbl, respectively.

The Feb’25 Brent futures contract initially saw weakness this afternoon, falling from $73.60/bbl at 12:00 GMT down to $72.45/bbl around 16:10 GMT, before recovering to $73.65/bbl at 17:30 GMT (time of writing). Crude oil prices were elevated amid reports that Israel is preparing for potential strikes against Iranian nuclear infrastructure, according to The Times of Israel. In the news today, the Kremlin has stated that Russian President Putin backs Hungarian Prime Minister Orban’s efforts to achieve a Christmas ceasefire in Ukraine and a major exchange of prisoners of war, as per Reuters. In other news, Saudi Arabia plans to ship 46mb of crude oil to China in January, the highest volume since October and significantly higher than the 36.5mb of volume expected in December, as per Reuters. Sinopec and PetroChina is expected to lift more crude, as well as non-state owned refiners Rongsheng Petrochemical and Shenghong Petrochemical. Finally, Germany’s oil product sales increased 6.2% y/y to 7.602 million tons in September, with heating oil recording the highest rise of 45.9% y/y to 1.114 million tons and jet fuel seeing the biggest decline of 18.7% y/y to 0.714 million tons, according to BAFA. At the time of writing, the Feb/Mar’25 and Feb/Aug’25 Brent futures spreads stand at $0.39/bbl and $1.67/bbl, respectively.