Distillates

The May’25 Brent crude came off to lows of $72.38/bbl on Friday afternoon before climbing to the $72.90/bbl region, seeing resistance at $73/bbl.

The Apr’25 Brent futures contract saw further strength this afternoon, increasing from $73.20/bbl at 12:10 GMT up to $73.90/bbl at 17:35 GMT. Bullish sentiment in crude oil has persisted after President Trump said on Wednesday that he would revoke Chevron’s license to operate in Venezuela. This could lead to the negotiation of a fresh agreement between the Chevron and state company PDVSA to export crude to destinations other than the US, anonymous sources told Reuters. In the news today, Russian Energy Minister Sergei Tsivilev said Russian oil companies will soon be able to restart oil projects in Kurdistan in the “near future”, as disputes between the Kurdistan Regional Government and Iraq over oil exports have been resolved. In other news, Israel announced it was sending negotiators to Cairo to extend the first phase of the Gaza ceasefire due to expire in two days, allegedly aimed at securing more hostages while delaying any final deal on Gaza’s future, as per Reuters. In macroeconomic news, US initial jobless claims increased by 22k to 242k in the week ending 22 Feb, the highest level since October. The median forecast in a Bloomberg survey of economists called for 221k applications. At the time of writing, the Apr/May’25 and Apr/Oct’25 Brent futures spreads stand at $0.53/bbl and $2.84/bbl, respectively.

The Apr’25 Brent futures contract has seen weakness since this morning, trading down from $73.30/bbl around 09:30 GMT to $72.50/bbl at 17:40 GMT (time of writing). EIA data released today for the week ending 21 Feb showed a 2.3mb draw in US crude oil inventories, compared to an expected build of around 2.5mb. In the news today, Iran has accelerated its production of near weapons-grade uranium. A report by the International Atomic Energy Agency (IAEA) said that as of 8 Feb Iran has 274.8 kilograms of uranium enriched up to 60%, an increase of 92.5 kilograms since the IAEA’s November report. In other news, several Canadian politicians have called for new pipelines to coastal export terminals to reduce dependency on the US market, according to Reuters. Currently, Canada sends around 90% of its oil exports to US refiners. Finally, Kazakhstan’s energy minister, Almasadam Satkaliyev, said oil exports are on schedule via its main oil export route, the Caspian Pipeline Consortium, despite damage to a pumping station last week. At the time of writing, the Apr/May’25 and Apr/Oct’25 Brent futures spreads stand at $0.48/bbl and $2.47/bbl, respectively.

The Apr’25 Brent futures contract sold-off this afternoon from around $74.40/bbl at 14:30 GMT down to $72.85/bbl at 17:30 GMT (time of writing). Crude oil prices saw bearish sentiment following poor economic news from the US and Germany, driven partly by concerns about President Trump’s push for trade tariffs. In the news today, Iranian oil sellers risk significant hurdles to moving their cargoes out the country with competition for unsanctioned tankers from Russia and Venezuela intensifying, according to Kpler. While there were around 150 tankers engaged in Iranian crude oil transport in 2024, more than 100 of these vessels are now sanctioned by the US, as per Bloomberg. In other news, the Kremlin has reiterated that European peacekeepers being deployed in Ukraine would be unacceptable to Russia, according to Reuters. This followed Russian Foreign Minister Sergei Lavrov’s comment last week, stating that NATO troops on the ground in Ukraine would be a “direct threat” to Russia’s sovereignty. Finally, Brazilian regulators are cracking down on some offshore drilling by oil giants like Petrobras and Equinor, Bloomberg reported. Two Petrobras rigs were temporarily suspended as of 20 Feb, while operations were halted at the Valaris drillship at Equinor’s Bacalhau field on Feb 17 under safety regulations. At the time of writing, the Apr/May’25 and Apr/Oct’25 Brent futures spreads stand at $0.48/bbl and $2.41/bbl, respectively.

Apr’25 Brent futures saw marginal strength this afternoon, trading from $74.55/bbl at 1200 GMT to $74.70/bbl at 1735 GMT. Crude oil prices have seen bullish sentiment after the US imposed a fresh round of sanctions targeting Iran’s oil industry, hitting more than 30 brokers, tanker operators, and shipping companies, as per Reuters. The UK has also announced its largest package of sanctions against Russia today since the early days of the war in Ukraine, including sanctions on a further 40 shadow fleet vessels. In other news, Russia’s Ryazan oil refinery, owned by Rosneft, halted operations after a Ukrainian drone strike, three industry sources told Reuters. The main crude distillation unit caught fire in the attack and has suspended oil processing, accounting for some 170kb/d or 48% of Ryazan’s refining capacity. Finally, the Iraqi Oil Ministry said in a press release that it “affirms its full commitment to the OPEC+ agreement” to cap oil output at 4mb/d, with the restart of Kurdistan oil exports appearing imminent. At the time of writing, the Apr/May’25 and Apr/Oct’25 Brent futures spreads stand at $0.47/bbl and $2.50/bbl, respectively.

The Apr’25 Brent futures flat price dropped to around $76.15/bbl at 1400 GMT to $74.90/bbl at 1715 GMT (time of writing) as it broke back below the 50-day moving average today. JODI data reported that China’s total product demand fell by 17 kb/d this month, while total product imports increased by 96 kb/d. Libya’s National Oil Corporation reported that oil production has declined to 1.405 mb/d. The US is pressuring Iraq to resume Kurdish oil exports, warning of sanctions over ties to Iran. Baghdad plans to restart exports next week, but payment and logistics disputes remain. According to Fox News Radio, President Trump stated that it is “not important” for Zelenskyy to attend peace meetings. The front (Apr/May) and 6-month (Apr/Oct) Brent futures spreads are at $0.36/bbl and $2.35/bbl, respectively, at the time of writing.

The Apr’25 Brent Futures contract was rangebound this afternoon, trading between $76.25/bbl and $76.60/bbl until around 16:00 GMT, after which it rallied to $77.02/bbl, where it sits at the time of writing (17:20 GMT). EIA statistics highlighted a 4.63mb build in crude stocks while distillates and gasoline drew 2.05mb and 0.15mb, respectively. In headlines, Texas based refiner HF Sinclair Corporation reported a Q4 2024 adjusted net loss of $191 million, missing analyst expectations due to declining refining margins driven by high global fuel supply and lower sales volumes. While other major refiners like Marathon Petroleum, Valero Energy, and Phillips 66 also faced profitability challenges, they exceeded analyst forecasts. Germany’s antitrust authority called for stronger regulation of oil price quotations, citing vulnerabilities to manipulation due to limited data and market participant dominance in price reporting. Meanwhile, Japanese oil firm Japex is refocusing on oil and gas after poor returns in renewables, citing rising costs in offshore wind projects. The company aims to acquire a US shale operator by 2026 and increase oil and gas investments through 2030, following a trend set by major energy firms like Shell, Equinor, and BP, which have also scaled back renewable energy commitments. At the time of writing, the front and 6-month Brent Futures spreads are at $0.47/bbl and $2.74/bbl respectively.

After the Apr’25 Brent futures rose from $76.30/bbl at 1300 GMT this afternoon to a weekly high of almost $76.80/bbl at 1440 GMT, before falling down to $76.25/bbl at 1735 GMT Overall, crude oil prices have been supported on fears of supply disruption, following the drone attack on the CPC pipeline oil flows and ongoing cold weather in the US. In the news today, oil flows from Iran to China rebounded in February after traders smoothed logistical bottlenecks caused by tighter US sanctions, seeing an increase in ship-to-ship transfers and use of alternative terminals, Bloomberg reports. In February, Iranian oil flows to China hit 1.7mb/d, a level last seen in Sep 2024 and up from 932kb/d in January, as per Kpler. In other news, Russian President Vladimir Putin said that Ukraine would not be excluded from negotiations to end the war, but success would depend on raising the level of trust between Moscow and Washington, according to Reuters. Finally, India is scouting for overseas oil storage and is in talks with Oman to hold about 5mb of crude oil, L.R. Jain, the chief executive of Indian Strategic Petroleum Reserves (ISPRL) stated. Jain told Reuters that this would be the first time that India will be holding storage overseas if a deal with Oman is reached. At the time of writing, the Apr/May’25 and Apr/Oct’25 Brent futures spreads stand at $0.41/bbl and $2.66/bbl, respectively.