Oil commentary - 11 June 2024

Morning all. Tuesday and WOW! Apple announced something about intelligence that I couldn’t care less about!!! I mean, of course I care, I’m just not the kind of person who is going to stay up all night to listen to a bloke tell me how, if I nod my head three times, wink, and turn around, my phone will order a pizza. I saw Elon Musk immediately responded with messages about it. I like Elon; he is to the tech world what Donald Trump is to politics: mad, but things wouldn’t be as much fun without him. Don’t adjust your screens! This is still an oil commentary! And whilst we’re on the subject of Donald Trump, let’s talk about other phoenixes that have risen from the ashes – crude oil. Brent is trading this morning at $81.67, up 0.04, and WTI is trading up 0.08 at $77.83. Pff. $60 per barrel, he said. Pff, too much of it, she said. Pff, OPEC+ have lost it, they said. Where are you now, you skeptical imbeciles! Ahem, sitting right here actually, Stanley. I may have alluded along similar lines, but let’s not get bogged down in who said what to whom and when, let’s be positive, shall we? This time last week, Brent was trading at $76.76. Right now, Brent is trading nearly 5 bucks a barrel higher, and, if I’m honest, I think the market has Kpler to thank. Hear me out. We reported last week (and said commentary stole colleagues' work and took it for his own, mwwwooohahahah) that oil prices were bottoming out as the first signs of drawing inventories were appearing onshore in China. Nice. I mean, I don’t ACTUALLY think that Kpler are moving the market here, that would be preposterous and arrogant, but the story came out very early on the 7th of June when Brent was trading below $80 per barrel, and continued its ascent up to the $82.17 seen yesterday. So, just saying. I have long been singing my colleagues' praises, and I shall continue to do so; a few weeks ago, we wrote that we see crude oil balances drawing by around 2.5 mn bpd over the summer, which will lead Brent to pop back up to the mid $80s. Anything higher than that would require another supply-side shock, and with the Atlantic Hurricane season forecast to be extremely active this year, perhaps the work of OPEC+ last week was a lot more significant than many would have you believe. Good day, and week to all.