Crude flat prices fell $1.5 but closed above $100 last week. Brent prompt futures moved weak in the first half, rebounded during the second half on the back of tradeline support. Middle Eastern flows calmed the nervousness in the market.
Timespreads temporarily paused last week’s rally, hitting a monthly high on Monday before expiry of Brent Nov month contract on Wednesday. Front month price curve structure continued to sport backwardation indicating the signs of crisis level prompt supply deficits.
Weekly Inventory data showed hefty draws in product stocks in U.S and SG Hubs while ARA reported build in stocks across Europe. Refined products markets demonstrated extreme volatility amid SPR restrictions.
Market Positioning data showed that Speculators were the net sellers of crude F&O contracts over the past week through Tuesday, Pullback in net length. Money managers reduced their net length in Brent crude F&O by 13,812 to 204,302 during the week. Longs left while shorts built up.
Technical Indicators showed that Charts indicate that the prompt month contract may touch $110, uptick may extend to $115 in the nearterm. On the other hand, if bears gain traction and drag the contract, it can decline to $96 and then subsequently to $94. A breach of $94, where the 50 day MA coincides can change the near-term outlook bearish. Notable support below $94 is at $84.
FUEL OIL MARKETS – SUMMARY
Asian fuel oil markets remain volatile, with VLSFO showing a cautiously bullish outlook on tighter inventories and supportive timespreads, while HSFO remains range-bound with a mild upward bias. Refinery economics, crack spreads, incoming cargoes and speculative positioning will determine near-term direction. Overall sentiment remains cautiously positive, although crude price volatility and inventory builds could trigger corrections.
OIL PRICES TREND – INDIAN CONTEXT
Nayara Energy has increased Diesel RSP by Rs.3 per ltr and petrol by Rs.5 per ltr across India. FO LDO Bitumen and Solvents prices revised up for the first half of
