If any had forgotten the important part Russia plays in the puzzle that makes up the complicated supply lines in the oil market, it was surely brought back in focus last week. The issues surrounding how Russia is being impeded in bringing its oil products to water were singularly responsible in arresting the recent downward grind trajectory and saved prices from looking at the year-to-date lows.
To identify the supportive element of the oil complex, one simply needs to look at yesterday’s settlement prices. The daily changes, all in cents per barrel, are telling indeed: WTI -1, Brent +11, RBOB -70, Heating Oil +207, and Gasoil +174 (due to its earlier settlement; otherwise, it would have outperformed CME Heating Oil). As the successful Ukrainian campaign against Russian oil infrastructure continues almost unabated, the latest targets being the ports of Novorossiysk and Tuapse, the invader has been forced to halt its diesel exports until the end of the year.
The macro world will once again turn US-centric for the next couple of days as a very important docket drags eyes back to how the Federal Reserve might react in its interest rate decisions. With Jerome Powell’s robotic stressing of the importance of inflation and employment earlier this week, today’s quarterly PCE readings, Jobless Claims and tomorrow’s PCE monthly data will keep the greater markets in thrall.
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