AMERICAS OIL: WTI crude is lower today
April 28 - Americas End-of-Day Oil Summary: WTI crude is lower today amid improved sentiment for a Ukraine peace agreement adding to existing pressure from demand concerns and increasing OPEC+ supply. Further sanctions on Iran cast doubt over progress in US-Iran talks, while the return of Greek shipowners to Russia’s Urals oil market should help support Russian loadings.
- Putin announced a ceasefire across May 7-11 for Victory Day. Ukraine has not agreed to the ceasefire, saying it is ready to abide by a ceasefire of at least 30 days.
- US Treasury Secretary Scott Bessent said trade negotiations “are moving along very well, especially with the Asian countries.”
- The US and Iran talks showed signs of progress after a third round of talks which were increasing detailed discussions according to the Iranian foreign minister.
- The US Treasury added three shipping/trading companies and three vessels to its Iran-related sanctions list on April 28.
- Several OPEC+ members want to approve another accelerated oil output increase for June at their meeting on May 5, Reuters said last week.
- Kazakhstan plans to increase oil export flows to Germany in 2025, according to its Minister of Energy, cited by Interfax.
- China added to crude inventories at a rate of 1.74m b/d in March, the most since June 2023, according to Reuters calculations.
- Saudi Aramco may increase its OSP for Arab Light by 10 to 30 cents m/m in June to a $1.30-1.50/bbl premium to the Oman/Dubai benchmark, according to Reuters.
- Trump’s EPA approved the sale of high-ethanol E15 for the summer with the aim of keeping gasoline prices low and supporting US agriculture. The EPA used the same emergency power used by President Biden in 2022, 2023 and 2024.
- Barclays lowered its 2025 Brent forecast ti $70/bbl, down $4/bbl from its previous outlook, Reuters reported. Brent is expected to average $62/bbl in 2026.
- US cracks are higher today, with an underlying decline in crude pricing outweighing product price declines. Tighter product inventories keeping some support in products.
- WTI June futures were down 1.5% at $62.05
- WTI July futures were down 1.5% at $61.36
- RBOB May futures were down 0.6% at $2.11
- ULSD May futures were up 0.4% at $2.18
- US gasoline crack up 0.4$/bbl at 25.89$/bbl
- US ULSD crack up 0.3$/bbl at 26.11$/bbl
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Historical bullets
USDCAD TECHS: Bullish Outlook
- RES 4: 1.4700 Round number resistance
- RES 3: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 2: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- RES 1: 1.4402 High Mar 20
- PRICE: 1.4292 @ 16:50 GMT Mar 28
- SUP 1: 1.4235 Low Mar 26 and a key near-term support
- SUP 2: 1.4151/4107 Low Feb 14 / 50.0% of Sep 25 - Feb 3 bull run
- SUP 3: 1.4011 Low Dec 5 ‘24
- SUP 4: 1.3944 61.8% retracement of the Sep 25 ‘24 - Feb 3 bull cycle
USDCAD traded through support at 1.4242 on Wednesday but has recovered. A return lower and clearance of this level would undermine the bull theme and instead highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. Moving average studies continue to highlight a dominant uptrend. A reversal higher would refocus attention on the bull trigger at 1.4543, the Mar 4 high. First resistance is 1.4402, the Mar 20 high.
US FISCAL: Debt Limit "Extraordinary Measures" Pick Up, But Cash Dipping Pre-Tax
Treasury data shows that there were $207B of "extraordinary measures" available to circumvent hitting the debt limit as of Wednesday Mar 26.
- That's the most since Jan 27th and up from $163B a week earlier, from a total $376B available.
- However, Treasury cash in the TGA fell to $316B as of the 26th (and was down to $280B on Thursday), meaning there were a combined $523B of resources available to avert the debt limit, the lowest since the impasse began in January (and half of the starting amount of just over $1T).
- The next couple of weeks will be very important for Treasury, as they represent the biggest tax take of the year. The Congressional Budget Office reported this week that per its estimates "if the debt limit [$36.1T] remains unchanged, the government's ability to borrow using extraordinary measures will probably be exhausted in August or September 2025." Treasury wrote to Congress this month that they would be able to provide an update on the x-date in the first half of May, after the conclusion of tax season.
AUDUSD TECHS: Remains Above Support
- RES 4: 0.6429 High Dec 12 ‘24
- RES 3: 0.6414 38.2% retracement of the Sep 30 ‘24 - Feb 3 bear leg
- RES 2: 0.6409 High Feb 21 and a bull trigger
- RES 1: 0.6391 High Mar 17 / 18
- PRICE: 0.6291 @ 16:46 GMT Mar 28
- SUP 1: 0.6258 Low Mar 21
- SUP 2: 0.6187 Low Feb 4
- SUP 3: 0.6171/6088 Low Feb 4 / 3 and a key support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
AUDUSD is unchanged. A short-term bull theme is intact and the latest move down appears corrective. Key short-term support to watch is 0.6187, the Mar 4 low. Clearance of this level would reinstate a bear threat. First support is at 0.6258, the Mar 21 low. A stronger recovery would refocus attention on 0.6409, the Feb 21 high. Clearance of this hurdle would strengthen the bull cycle and resume the uptrend that started Feb 3.
