- Oil is higher this morning, near the top of the recent range
- WTI has been trading in a tight range for the past six days between $80 and $82/Bbl
- Oil products have strengthened, with the 3-2-1 crack spread rising to the highest level in a month
- Global refining margins have been weak lately, which is a bearish factor for crude prices
- Citi warns that recent gains in oil could prove fragile (BBG)
- The bank said in a note that market participants should “not chase this rally as current price levels look too rich”
- Citi cited weak Asian markets, with refinery runs in China repeatedly being revised lower, although conditions should improve in the second half of the year
- There is currently an overhang of cargoes in the Atlantic basin, with 25 MMBbls of unsold Nigerian crude waiting for buyers
- However, renewed geopolitical tensions in the Middle East and Russia have supported prices lately
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