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Crude Prices, OPEC+ and Middle East Risk · The Gathering Line

• 0:00
  Sunday, October fourth.
• 0:02
  Here's what moved ahead of Monday's nomination cycle.
• 0:05
  Global first.
• 0:07
  Brent settled Friday at one hundred two dollars and twenty five cents,
• 0:10
  down six cents on the day and up about seven percent over the past month,
• 0:15
  per Trading Economics.
• 0:17
  W T I settled at ninety one dollars and eleven cents, down a dollar seventy six,
• 0:21
  which leaves the Brent to W T I spread at eleven dollars and fourteen cents.
• 0:26
  That is a wide arb, and it keeps pulling waterborne barrels toward the Gulf Coast
• 0:31
  docks.
• 0:32
  The cushion under prices is the G seven and E U agreement to release up to one
• 0:37
  hundred million barrels of diesel and crude over four months.
• 0:40
  French President Macron announced it, and the split is roughly half diesel and half
• 0:44
  crude.
• 0:46
  The new risk is Saturday.
• 0:48
  Yemen's Houthis said they hit an Aramco facility in Riyadh with missiles and drones.
• 0:53
  Reuters carried a witness account of fire and smoke south of the capital.
• 0:57
  Aramco and Saudi authorities have not confirmed the extent of the damage,
• 1:00
  so treat any outage number you hear as unverified.
• 1:04
  Futures reopen tonight, which means that headline is not priced yet.
• 1:08
  It lands on top of tanker attacks near Hormuz and a third U S carrier group heading
• 1:12
  to the region.
• 1:14
  On OPEC plus, Reuters reports ministers agreed in principle to hold November targets
• 1:19
  steady ahead of today's formal meeting.
• 1:21
  My notes have the planned one hundred eighty thousand barrels per day monthly
• 1:24
  restart pegged for December, contingent on Iraq and Kazakhstan compensation.
• 1:30
  Watch the meeting language.
• 1:31
  That's where a surprise would come from.
• 1:33
  North America.
• 1:35
  Western Canadian Select at Hardisty is reported at sixteen dollars and sixty five
• 1:39
  cents under W T I, widening on Midwest heavy turnarounds.
• 1:43
  One caution: the outright quote I have, eighty dollars and fifty two cents from
• 1:47
  OilPrice, is two days old and doesn't reconcile with that discount.
• 1:51
  Ten fifty nine would be the gap off Friday's W T I.
• 1:55
  So call the direction wider, and treat the exact number as soft until you see a
• 1:59
  fresh assessment.
• 2:01
  Baker Hughes had Canada up eight rigs to two hundred sixteen.
• 2:05
  Express is running full into Casper at two hundred eighty thousand barrels per day,
• 2:09
  and Trans Mountain is steady near sixty percent of capacity.
• 2:13
  Nothing new on Mexico.
• 2:15
  United States.
• 2:16
  There was no scheduled E I A release in this window, so this is last Wednesday's
• 2:20
  report, week ending September twenty sixth.
• 2:23
  Commercial crude rose one point eight million barrels to four hundred sixteen point
• 2:28
  five million, about four percent under the five year average.
• 2:31
  Refinery utilization fell three hundred eight thousand barrels per day to ninety one
• 2:36
  point four percent as fall maintenance builds.
• 2:39
  Distillate gained six tenths of a million barrels and still sits six percent under
• 2:43
  the five year average.
• 2:44
  I don't have consensus in front of me, so I won't call a surprise.
• 2:48
  Cushing is described as thin, near operating bottoms, which keeps prompt barrels
• 2:53
  firm.
• 2:54
  Friday's Baker Hughes count: the U S total fell one to five hundred ninety eight,
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  up forty nine on the year.
• 3:01
  Oil rigs rose four to four hundred eleven, gas rigs fell two to one hundred thirty
• 3:05
  two.
• 3:06
  Permian added one to two hundred forty one.
• 3:09
  On corporate news, the market is positioning around Enbridge's reported two point
• 3:13
  five five billion dollar purchase of Tallgrass crude assets,
• 3:17
  including the Pony Express stake.
• 3:19
  I haven't confirmed that against a primary source, so treat it as market talk.
• 3:24
  Now your barrels.