Reports

The November Brent Futures contract has seen a weak morning, trading down from daily highs of around $77.53/bbl at 08:00 BST to $75.73/bbl at the time of writing (11:20 BST). In headlines, two tankers, the Panama-flagged Blue Lagoon I and the Saudi-flagged Amjad, were struck by attacks in the Red Sea, with the Houthis claiming responsibility only for the former, according to Reuters. Both tankers, which sustained no significant damage, were able to continue their routes, the Amjad has a capacity of up to 2 mb of crude, while the Blue Lagoon I can carry 1 mb. The US Central Command criticized the Houthis’ actions as destabilizing regional commerce and endangering maritime safety. This attack reflects a broader trend of the Houthis targeting vessels in the Bab al-Mandab strait since last November, initially focusing on Israeli and allied ships but expanding their targets. Meanwhile, Russia has reportedly complied with its OPEC+ oil production cut obligations as of August, Deputy Prime Minister Alexander Novak told Interfax, as the country aims to make up for overproduction in 1H’24 of around 500kbpd by the end of the year. Russia exceeded its OPEC+ quota by 67 kb/d in July, with the government attributing the excess output “to one-off problems with the supply schedule, while the levels in August and September should make amends for this.” At the time of writing, the Nov/Dec and Nov/May’25 Brent Futures spreads are at $0.62/bbl and $2.05/bbl, respectively.

Nov’24 Brent futures flat price showed volatility this morning, rallying from $76.37/bbl at 07:00 BST to $77.18/bbl at 10:15 BST, before steeply declining to $76.80/bbl at 11:00 BST (time of writing). In the news today, Guyana raised their 2024 GDP growth estimate to 42.3%, following a surge in oil production offshore in the Stabroek block. In other news, further data has been published showing the weakening of China’s economy. Chinese manufacturing PMI has declined to 49.1 from 49.4, the National Bureau of Statistics said on Saturday, with factory activity in contraction for the fourth month in a row. In light of this, economists at banks including UBS and J.P. Morgan expect China will not reach its growth target of 5% for 2024. Finally, the oil depot fire in Russia’s Rostov region has been extinguished, two weeks after Ukraine’s latest drone attack on Russian energy infrastructure. At the time of writing, the front month (Nov/Dec’24) and six-month (Nov/May’25) Brent futures spreads are at $0.75/bbl and $2.38/bbl, respectively.

Nov’24 Brent futures flat price was volatile this morning, strengthening from $79.14/bbl at 07:00 BST to a high of $79.49/bbl at 08:25 BST before declining to $78.81 at 11:20 BST (time of writing). In the news today, OPEC’s secretary general visited Baghdad, Iraq, securing assurance on full conformity with compensation cuts, which plan to reduce Iraq’s output to between 3.85-3.9 mb/d in September. In other news, Reuters confirmed this morning that no oil spill has been detected off the coast of Yemen, after an abandoned 274-metre-long oil tanker, containing around 1 mb, was attacked by Houthi rebels. An oil spill of this magnitude with 150,000 tonnes of crude would be more than half the size of the largest ever spill recorded from a ship, according to the International Tanker Owners Pollution Federation Limited (ITOPF). Finally, Shell has decided to cut 20% of its workers in oil and gas exploration units, focused in the US, Netherlands, and Britain. At the time of writing, the front month (Nov/Dec’24) and six-month (Nov/May’25) Brent futures spreads are at $0.87/bbl and $2.81/bbl, respectively.

The October Brent Futures contract has seen a volatile morning, trading from $78.90/bbl around 08:45 BST to a low of $78.12/bbl at 10:00 BST before rallying back up to print at $78.68/bbl, at the time of writing (11:30 BST). In headlines, Libya’s oil production, which stood at 1.2 mb/d, was halted at several fields after the rival eastern government ordered a stop to all oil production and exports. This move deepened Libya’s political crisis, stemming from a dispute over the leadership of the Central Bank of Libya, the sole internationally recognized depository for the country’s oil revenues. Meanwhile, ONEOK, one of North America’s largest energy infrastructure operators, announced a $5.9 billion acquisition of stakes in two energy companies from Global Infrastructure Partners. ONEOK will acquire a 43% stake in EnLink Midstream for $3.3 billion and a stake in Medallion Midstream for $2.6 billion. This follows ONEOK’s $18.8 billion acquisition of Magellan Midstream Partners last year, further expanding its network of over 50,000 miles of pipelines. At the time of writing, the Oct/Nov and Oct/Apr’25 Brent Futures spreads are trading at $1.06/bbl and $3.39/bbl, respectively.