OIL: Med Could Take More Mideast Crude in 2025: Argus
The Mediterranean region's capacity to absorb returning sour crude output in 2025 will hinge on nimble pricing strategies by Saudi Arabia and Iraq, Argus said.
- The Med imported around 4.67m b/d of crude in 2024, down from 4.92m b/d in 2023, Vortexa showed.
- The drop follows heavy spring refinery maintenance, unplanned refinery outages and weak product margins prompting some regional refiners to cut runs.
- Competitive pricing by Mideast Gulf crude producers could help entice Mediterranean buyers during the summer.
- Completed repairs at Greece’s 180k b/d Corinth refinery in Q3 could help absorb a planned production increase from OPEC+ from April.
- Aramco's consistent cuts to its OSPs in recent months left its December 2024 prices for Med customers averaging $2.13/b less than in January 2024.
- This adaptive pricing strategy has helped Aramco retain market share in the region despite overall weaker demand.
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CROSS ASSET: Tsys, Equities Touch Session Highs On Oil Fade
A notable drop in oil prices (Brent -70 cents about 20 minutes ago in short order) appears to be underpinning equities and Treasuries to session highs. 10Y US TIPS-implied breakevens have dipped to session lows a touch through 2.30%, down 3bp from the day's (and 7-session) highs. Some color on the oil move from our Commodities team:
- Crude prices have dipped further on the day, although no clear headline drivers are visible at present.
- WTI JAN 25 down 1.6% at 68.81$/bbl
- The market remains sensitive to any chatter ahead of OPEC+’s meeting Dec. 5 where the bloc is expected to delay its unwinding of voluntary cuts until the end of Q1.
- Any indication that cuts may go ahead as planned, or even a smaller than expected delay, could add pressure to prices.
US: Trump Nominates Paul Atkins For SEC Chair
US President-elect Donald Trump has continued a flurry of executive branch nominations by tapping Paul Atkins to be the next Chairman of the Securities & Exchange Commission, to replace outgoing Chair Gary Gensler.
- Trump said in a statement on Truth Social: "Paul is a proven leader for common sense regulations. He believes in the promise of robust, innovative capital markets that are responsive to the needs of Investor... He also recognizes that digital assets & other innovations are crucial to Making America Greater than Ever Before."
- Bloomberg notes: "...Trump is tapping one of the most influential GOP financial regulation insiders to oversee Wall Street. If confirmed, Atkins is expected to focus on whittling away at regulations and levying lower penalties for violations."
- Tyler Gellasch, president of the Healthy Markets Association, said: “He’s the godfather of conservative capital markets ideology and mentor to a generation of policymakers. It’s hard to imagine a more connected and capable leader to scale back the SEC and its rules.”
- Atkins' nomination fulfils a Trump campaign promise to appoint a crypto-friendly administration. The NYT notes Atkins, "has been playing an active role in helping to draft “best practices” for crypto trading platforms as co-chair of the Token Alliance, which is part of the Digital Chamber of Commerce."
- Trump also nominates William Joseph McGinley to serve as Counsel to the Department of Government Efficiency (“DOGE”) and David Warrington to serve as Assistant to the President and Counsel to the President - the top attorney in the White House.
EURUSD TECHS: Resistance Remains Intact For Now
- RES 4: 1.0937 High NOv 5 / 6 and a key resistance
- RES 3: 1.0825 High Nov 7
- RES 2: 1.0730 50-day EMA
- RES 1: 1.0590/97/98 20-day EMA / High Nov 29
- PRICE: 1.0527 @ 17:01 GMT Dec 4
- SUP 1: 1.0425/0335 Low Nov 26 / 22 and the bear trigger
- SUP 2: 1.0311 1.382 proj of the Sep 25 - Oct 23 - Nov 5 price swing
- SUP 3: 1.0258 1.500 proj of the Sep 25 - Oct 23 - Nov 5 price swing
- SUP 4: 1.0201 61.8% retracement of the Sep 28 - Juk 18 bull leg
Key short-term resistance in EURUSD to watch is 1.0590, the 20-day EMA. It remains intact and Monday’s move lower reinforces the short-term importance of this resistance. A clear break of it is required to signal potential for a stronger recovery. This would open 1.0730, the 50-day EMA and allow for a continued unwinding of the oversold trend condition. The medium-term trend direction is down. The bear trigger lies at 1.0335, the Nov 22 low.
