The July Brent futures flat price has rallied significantly this morning following a weak overnight period. The price hit a low of $81.30/bbl at 06:50 BST, however since then it has shot up aggressively to $82.50/bbl handles, where it currently sits as of 11:15 BST (time of writing). Russia has pledged to make up for crude overproduction in April and will soon submit its plan to rectify this to the OPEC secretariat. This comes at the same time that Russian President Vladimir Putin stressed his desire for his country to supply more energy to China, stating Russia is ready to provide “uninterrupted” and “ecologically clean” energy. A shadow fleet oil tanker transporting Russian crude had an engine failure as it passed through Turkey’s Dardanelles strait, forcing a temporary blockage to maritime traffic. Singapore’s fuel oil stockpile has sunk to its lowest level in 5 ½ years in the week to May 22, with inventories falling 17.46% w-o-w to 15.8mbbls, a figure that came despite a rebound in net imports, which rose 186.1% w-o-w to 873,675 tons. Finally, Chinese refinery runs rose by 1.33mbbls/d to 15.9mbbls/d and was 9% above the 5-year average. The front and 6-month spreads are $0.28/bbl and $2.70/bbl, respectively.
