| Commoditiy | Price | Weekly Change | 50day-Ave | 100day-Ave | 200day-Ave |
|---|---|---|---|---|---|
| Brent ($/b) | 71.27 | -1.88 | 93.31 | 93.71 | 78.93 |
| US WTI ($/b) | 68.01 | -1.22 | 89.83 | 88.46 | 74.28 |
| ICE Gasoil ($/MT) | 947.75 | 40.50 | 1,068.85 | 1,096.74 | 887.98 |
| Jet CIF NWE ($/MT) | 967.62 | 23.95 | 1,151.56 | 1,241.45 | 979.76 |
Brent traded close to 70 \$/b last week and the market appears increasingly confident that oil will continue to flow out of the Persian Gulf.
Although many operators remain wary of the Strait, some of those who are prepared to use it are carrying out multiple shuttle runs in and out of the Gulf, moving crude to tankers waiting on the other side. This is enabling substantial volumes of crude to move through the Strait in addition to the more typical flows to final destinations. Talks between the US and Iran have also been paused due to the funeral of Iran’s Ayatollah and while that continues there appears to be a limited near-term risk of a further flare-up in hostilities.
Over the weekend, OPEC+ agreed to increase output. The seven countries that agreed to additional voluntary cuts have announced another small monthly increase, as they have done over the last few months. These increases were less relevant while output was constrained, but as oil flows more freely again, their cumulative effect becomes more important. More significantly, while prices remain relatively high, some OPEC+ members, particularly Iraq, are likely to be focused on making up for lost revenue, which could make it harder for Saudi Arabia to maintain discipline. As a consequence, the oil market may experience further downward pressure.
Conditions have been more difficult for middle distillates, such as diesel, where the benefit of falling crude oil prices has been more than offset by increasing challenges for the Russian refining industry following Ukrainian strikes. Russia is usually a significant exporter of refined products such as diesel, but the disruption has become severe enough that it may now need to import some products. Consequently, diesel and jet fuel prices have been rising and remain well above pre-war levels, even six months or a year forward on the curve.
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