OIL: Oil Firms Ahead of U.S. Stock Draw Expectations
Dec-27 2024 16:18
Oil finds support on Friday but remains within the recent range lacking any significant drivers on thin trading ahead of the latest EIA report.
- Brent FEB 25 up 0.9% at 73.95$/bbl
- WTI FEB 25 up 1.1% at 70.39$/bbl
- The API reported US crude inventories fell 3.2M bbl last week. Five analysts polled by Reuters estimated on average that crude inventories fell by about 1.9 million barrels in the week to Dec. 20.
- The U.S. Energy Information Administration's official weekly inventory report is due at 1 p.m. EST (1800 GMT)
- The prompt spread on West Texas Intermediate futures points to near-term supply tightness with the nearby contract trading at a premium of more than 40 cents a barrel to the next in line.
- Goldman’s Struyven said that any near-term tightness was being overlooked by the market over 2025 signs of weakness.
- Dollar strength following the latest Fed meet on Dec.18 has capped any upside for oil.
- The Pemex Dos Bocas refinery in Mexico is a long way off manufacturing clean products according to OPIS lead analyst Tom Kloza.
- Shell has shut down an oil processing unit at it 237,000 bpd Pulau Bukom refinery in Singapore to investigate a suspected leak.
- There appear to be issues at BP’s Whiting, Indiana refinery that are not insignificant according to GasBuddy’s Patrick De Haan on X.
- Chinese refiners plan to export 3.34m tons of oil products in January, down 17% y/y according to OilChem.
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EGBS: BTP Spreads Unwind Yesterday’s France-led Widening
Nov-27 2024 16:13
10-year EGB spreads to Bunds have tightened through the session, unwinding a portion of yesterday’s sharp OAT-led widening.
- French paper usurpingly lags, with political uncertainty set to remain prevalent into year-end. The OAT/Bund spread is 1bp tighter today at 85bps.
- The BTP/Bund spread has fully unwound yesterday’s widening though, down almost 4bps today at 124bps.
- The relative political stability in Italy compared to France has supported BTP outperformance over OATs since the French snap legislative elections were announced in early June. 10-year BTP/OAT spread has extended multi-decade lows through November and now trades below 40bps.
- Alongside the ongoing risk of Government collapse, S&P are due to review France’s sovereign rating on Friday, which presents a further potential headwind for OATs.
