President Trump’s deadline for Russia to strike a peace cope with Ukraine handed with out stricter US sanctions imposed on Moscow. This doubtless contributed to the latest weak spot in crude oil costs, with Brent buying and selling at its lowest ranges since early June, ING’s commodity specialists Ewa Manthey and Warren Patterson notice.
Speculators are bearish in the direction of the oil market
“The market is targeted on Trump’s assembly with President Putin on Friday – and whether or not any progress in the direction of a peace deal will be made. However with Russia demanding that Ukraine cede occupied territory to finish the struggle, it’s tough to see a fast answer. It’s unlikely that Ukraine will agree to surrender its personal territory. If we do see some stage of de-escalation, it might take away sanction danger from the oil market. This is able to doubtless drive costs decrease, given the bearish fundamentals.”
“The newest positioning knowledge reveals that speculators are bearish in the direction of the oil market, regardless of the sanctions and secondary tariff dangers. Speculators diminished their web lengthy in ICE Brent by 20,375 tons during the last reporting week to 240,977 tons as of final Tuesday. This was a transfer predominantly pushed by longs liquidating. In the meantime, it was unsurprising to see that speculators diminished their web lengthy in ICE Gasoil by 14,637 tons over the week to 86,007 tons. The ICE gasoil market has seen some weak spot extra just lately, with each the crack and timespreads edging decrease.”
“The US oil rig rely noticed its first weekly improve since April, rising by one to 411 lively rigs final week, in response to Baker Hughes knowledge. Rig exercise has declined considerably in latest months amid value weak spot and the bearish market outlook. Nonetheless, more moderen value stability helped to sluggish the decline within the rig rely.”
