ICE Brent pushed above US$77/bbl yesterday with sentiment still largely supportive following a stronger physical market, ING’s commodity analyst Ewa Manthey and Warren Patterson note.
Strength in the market continues in early morning trading
“Concerns over Iranian and Russian oil flows will also be providing some support. There were reports yesterday that a port operator in Shandong, China, has told ports not to accept tankers sanctioned by the US. Refiners in the region are large buyers of Iranian crude oil and so if these ports follow through, it potentially provides more obstacles to Iranian oil flows.”
“Strength in the market continued in early morning trading today after API numbers showed that US crude oil inventories fell by 4m barrels over the last week, while Cushing stocks declined by 3.1m barrels. It was less bullish on the product side with gasoline and distillate stocks increasing by 7.3m barrels and 3.2m barrels respectively. The more widely followed EIA inventory report will be released later today.”
“European gas prices initially came under pressure yesterday with TTF trading just below EUR46/MWh. However, the market strengthened in the latter part of the trading session, which saw TTF settling marginally higher on the day. EU storage is 69% full at the moment, down from 85% at the same stage last year and below the five-year average of 75%. A faster-than-expected fall in inventory will leave the market nervous, particularly with the colder weather Europe is facing at the moment.”
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