Written Commentary
CRUDE OIL
Indian Refiners Reselling Crude
December Crude could see pressure today on news that the Indian oil refiner Reliance is attempting to resell some of the Middle Eastern crude it bought last month after Russian oil producers were hit by the latest round of sanctions. As expected, Saudi Arabia has reduced the prices of its crude for Asian buyers for December. Earlier this week the CEO of Gunvor Group said that the sanctions on Russia and Iran have led to record volumes of oil being stored on vessels. Reuters reported yesterday Russia’s seaborne crude shipments saw their largest weekly decline since January 2024 this week.
PRODUCTS
Contrary to crude oil, the product markets saw substantial rallies overnight, with December RBOB approaching its July high and December ULSD reaching towards it June 23 high. News yesterday that Russia’s Black Sea port of Tuapse has suspended fuel exports after its oil refinery halted processing in the wake of Sunday’s drone attacks by Ukraine. The Ukrainian attacks in recent months have at times damaged Russian refinery capacity to cause shortages of gasoline and diesel fuel.
NATURAL GAS
January Natural Gas is higher today but inside the range of the past two sessions. If consolidation means continuation, the next move would be a breakout up and an extension of the recent rally. Reuters reported that Poland is working on a deal to import liquefied natural gas from the US to supply Ukraine and Slovakia. Already, US LNG exports are running at a record pace, with LSEG reporting that the average amount of gas flowing to the eight big export plants gas have risen to 17.4 billion cubic feet per day so far in November, up from a record 16.6 bcfd in October, which was up from a previous record of 16.0 bcfd set in April.
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