| Commoditiy | Price | Weekly Change | 50day-Ave | 100day-Ave | 200day-Ave |
|---|---|---|---|---|---|
| Brent ($/b) | 78.45 | 6.46 | 89.67 | 94.05 | 79.15 |
| US WTI ($/b) | 73.57 | 5.02 | 87.20 | 88.90 | 74.50 |
| ICE Gasoil ($/MT) | 1,046.50 | 73.75 | 1,044.24 | 1,113.92 | 896.40 |
| Jet CIF NWE ($/MT) | 1,081.64 | 94.56 | 1,113.17 | 1,255.55 | 988.42 |
Brent closed last week around 75 \$ last week after the US said Iran talks could continue after both sides exchanged some attacks and the Memorandum of Understanding looks shaky once again.
Just as it looked as though confidence in shipping energy through the Strait was growing, hostilities have flared up once more. Iran has again shown it wants to assert control over the Strait by attacking a Qatari LNG tanker that had not complied with the process Iran wanted it to follow. The US retaliated leading to a round of tit-for-tat reprisals and this time, the US did not wait until markets closed for the weekend before initiating its attacks. In a press conference at the NATO summit in Ankara last week, Trump said that the ceasefire is "over" that his negotiators "want to negotiate" with Iran, but "As far as I'm concerned, it's just a waste of time dealing with them. They're liars." He also said that the US might hit Iran again "hard" and talked about the possibility of reimposing the naval blockade against Iran.
Problems grew over the course of the week after another tanker was attacked by Iran, Iran declared that the Strait was “closed” and the US have been attacking Iran again over the weekend. The oil market had become increasingly confident that the worst of this crisis was over and whereas Brent traded close to 70 \$/b at the end of the previous week, it rallied to just over 80 \$/b last week. Though the US has shown it willing to come down heavily on Iran in response to attacks on shipping, unfortunately, the military action does not seem able to remove the threat of the one-off Iranian missile strikes. While the only time that the intractable disagreement over Iran’s control of the Strait looked like it might have a solution was when the US had appeared content to concede that point.
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. Last week Russia announced a diesel export ban for three weeks, although this of course go on for longer. Diesel and middle distillate prices have once again diverged from crude, to put this into context, the last time diesel traded at this level Brent was trading around 95 \$/b in early June.
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