OIL PRODUCTS: Oil Products End of Day Summary: Cracks Extend Pull Back
Diesel cracks continue to pull back from recent highs and set for a net decline on the week amid speculation surrounding the US plan for Russia-Ukraine peace. However, cracks remain strong overall, and above start of month levels, amid concern for tight supplies due to refinery outages, ongoing Russian energy infrastructure strikes and as US sanctions on the Russian producers start.
- US gasoline crack down 0.5$/bbl at 18.05$/bbl
- US ULSD crack down 1.7$/bbl at 42.28$/bbl
- The US push for a Russia-Ukraine peace deal is offsetting uncertainty over any supply disruptions caused by the start of the sanctions on Russian producers Rosneft and Lukoil. Bloomberg headlines suggest that Ukraine and European allies reject key parts of the US plan.
- Citgo’s 175k b/d Corpus Christi, Texas, refinery is undergoing a restart following planned maintenance, the company said in a community alert Nov. 21.
- US refiners are expected to have about 645kb/d of capacity offline in the week to Nov. 21, according to IIR Energy cited by Reuters.
- Kuwait’s 615k b/d Al-Zour refinery, which has been running at about one-third of capacity for almost a month, Bloomberg said.
- Growing South American diesel demand is likely to support PADD 3 refiners for the medium term, despite diverging trends for South America West Coast and East Coast clean product arrivals, Vortexa said.
- Reliance Industries says it has stopped importing Russian crude into its Sez refinery with effect from Nov. 20, and that from Dec. 1 all product exports from the refinery will be obtained from non-Russian crude, Reuters reports.
- Monthly shipments of diesel-type fuel from Russia’s Baltic Port of Primorsk dropped in October, according to a port report and Bloomberg ship tracking data.
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US TSYS: Tsys Buoyed Amid Ongoing Trade Tensions
- Treasuries look to finish modestly higher Wednesday, reversing midmorning losses after Reuters reported the Trump admin "is considering broad restrictions of exports to China made with US software, citing an unnamed US official and three people briefed by US authorities."
- No noticeable reaction in rates after late Bbg headline: "US TO ANNOUNCE 'PICK UP' IN RUSSIA SANCTIONS TODAY OR TOMORROW".
- Treasury futures gain slightly (TYZ5 113-24 +0.0) after $13B 20Y Bond auction re-open (912810UN6) stopped through - drawing a high yield of 4.506% vs 4.517% WI at the cutoff; 2.73x bid-to-cover vs. 2.74x prior.
- The Wall Street Journal reports citing sources that the ADP has stopped providing the Fed with weekly data on private payrolls and earnings. Per the WSJ piece, the Fed has had access to the data since "at least 2018", and was available to the Fed with "a roughly one-week delay". The publicly-available ADP payrolls report is published monthly.
- Equity earnings expected to release after the close include Southwest Airlines, Raymond James, Churchill Downs, Alcoa, Crown Castle, United Rental, Lam Research, Tesla and IBM.
- Thursday's weekly Jobless Claims & Chicago Fed data suspended.
AUDUSD TECHS: Potential Reversal Signal
- RES 4: 0.6726 1.236 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 3: 0.6660/6707 High Sep 18 / 17 and a bull trigger
- RES 2: 0.6629 High Sep 30 & Oct 01 and key short-term resistance
- RES 1: 0.6545 50-day EMA
- PRICE: 0.6505 @ 15:38 BST Oct 22
- SUP 1: 0.6440 Low Oct 14
- SUP 2: 0.6415 Low Aug 21 / 22 and a bear trigger
- SUP 3: 0.6373 Low Jun 23
- SUP 4: 0.6357 Low May 12
AUDUSD remains in consolidation mode. Price action on Oct 14 continues to highlight a possible reversal pattern - a hammer candle. It signals the end of the bear cycle that started Sep 17. Note that MA studies have remained in a bull-mode position during the latest bear leg, highlighting a dominant M/T uptrend. Initial resistance is 0.6545, the 50-day EMA. A breach of 0.6440, the Oct 14 low, would cancel the reversal pattern and reinstate a bear threat.
AUDUSD TECHS: Potential Reversal Signal
- RES 4: 0.6726 1.236 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 3: 0.6660/6707 High Sep 18 / 17 and a bull trigger
- RES 2: 0.6629 High Sep 30 & Oct 01 and key short-term resistance
- RES 1: 0.6545 50-day EMA
- PRICE: 0.6485 @ 15:46 BST Oct 22
- SUP 1: 0.6440 Low Oct 14
- SUP 2: 0.6415 Low Aug 21 / 22 and a bear trigger
- SUP 3: 0.6373 Low Jun 23
- SUP 4: 0.6357 Low May 12
AUDUSD remains in consolidation mode. Price action on Oct 14 continues to highlight a possible reversal pattern - a hammer candle. It signals the end of the bear cycle that started Sep 17. Note that MA studies have remained in a bull-mode position during the latest bear leg, highlighting a dominant M/T uptrend. Initial resistance is 0.6545, the 50-day EMA. A breach of 0.6440, the Oct 14 low, would cancel the reversal pattern and reinstate a bear threat.
