Senior Market Strategist at Rabobank Benjamin Picton observes that despite continuous logistical and geopolitical interruptions to oil and refined products, Brent futures dropped more than 7% and Singapore gasoil nearly 11%. Picton emphasizes how recent price drops contrast with ongoing supply risks, highlighting the "capriciousness" of the market and raising the possibility that traders are pricing too soon to address issues with the product market and an impending oil glut.
Despite disruptions, oil prices decline.
"The front Brent oil future plummeted by more than 7%, despite the fact that there is no proof of meaningful progress in lifting constraints on global energy flows."
"ICE gasoil futures fell by more than 8.5% despite Russia's continued ban on diesel exports, ongoing Ukrainian attacks on energy infrastructure, the Houthis' recent decision to extend the Iran conflict to Saudi oil infrastructure in the Red Sea, and low water levels in the Rhine disrupting energy shipping and driving up freight rates."
"Similarly, spot prices for gasoline in Singapore were down by about 11% yesterday."
"You would believe all of the issues in product marketplaces are resolved based on those numbers."
"It was just a few weeks ago that I was reading articles making blatant indications of an imminent oil surplus; this again underscores the capriciousness of markets."
Despite disruptions, oil prices decline.
"The front Brent oil future plummeted by more than 7%, despite the fact that there is no proof of meaningful progress in lifting constraints on global energy flows."
"ICE gasoil futures fell by more than 8.5% despite Russia's continued ban on diesel exports, ongoing Ukrainian attacks on energy infrastructure, the Houthis' recent decision to extend the Iran conflict to Saudi oil infrastructure in the Red Sea, and low water levels in the Rhine disrupting energy shipping and driving up freight rates."
"Similarly, spot prices for gasoline in Singapore were down by about 11% yesterday."
"You would believe all of the issues in product marketplaces are resolved based on those numbers."
"It was just a few weeks ago that I was reading articles making blatant indications of an imminent oil surplus; this again underscores the capriciousness of markets."
