The Officials

The market always has a few juicy rumours about trading car crashes and, every once in a while, about a big train crash with vast amount of dollar bills burned up. Nobody is immune, as we know after observing this markets for a long time. The psychology is that losses are more talked about than wins even though for every loser there is a winner. This time it is Vitol’s turn to be in the spotlight and just to make sure we don’t get it wrong we asked them. This hopefully minimises but not
totally eliminates the possibility of getting a letter crafted with great care and penmanship. Forgive me if I digress but I have been zinged before .

The bearish vibes kept gnawing away at flat price this afternoon, dragging it down to a low of $68.15 after the close as the prompt spread also slid to 79c from its intraday high. The structure is holding up further down the curve, though, as the widely watched Dec25/Dec26 spread is trading near 50c. Extra Middle East crude supplies are weighing down the market.

In the week ending 18 July 2025, exchange traded futures volumes rose w/w across Brent, WTI and Gasoil futures throughout the first three tenors. The biggest change occurred in October tenor of the Gasoil contract, which rose 53.5% w/w. By contrast, Heating Oil and RBOB exchange traded futures volumes decreased across the board, by small increments in all but the November RBOB contract, which dropped over 30% w/w.

The Dubai window continued in much the same vein as in recent sessions, with the physical premium remaining firmly anchored around the sticky $3 level it’s been inhabiting throughout July trading. Today, Gunvor was the aggressor, lifting
plentiful offers from the likes of PetroChina, which remained active offering though was less spritely at hitting bids than
we’ve seen lately, Reliance and Hengli, while Glencore got lifted a fair amount too. Exxon and Vitol joined in on the lifting bonanza but it was Gunvor alone that reached a convergence today, with Reliance nominating an Upper Zakum cargo. This brings July’s total convergence count to 13, of which every one has been UZ and only two have been nominated by non-PC sellers (Glencore and Reliance). Clearly, it’s Vitol that’s collected the most, having picked up 8, while Gunvor’s bagged 3 and Exxon got the other 2. This saw the physical premium slide slightly to $2.94.

Brent battled along through the European morning, managing to regain the $69 level, but hoping for some impetus from Team America. But Team America only added its weight to the downward momentum, seeing Brent all the way down at $68.43, though a late rebound meant it closed at $68.95/bbl.
Midland was the hot commodity in the North Sea window today. Totsa was bidding for a 12-16 August cargo at Dated +$1.65, while Exxon bid a later 21-25 August cargo at $1.60 over Dated. PetroIneos offered 14-18 August at Dated +$1.95, but nobody wanted to take the leap and cross the spread. But Midland wasn’t the only grade on the menu today, as Unipec bid both a 5-18 August Forties at Dated +$0.75, while also bidding the same price for a 7-9 August Brent. Ekofisk was also up for grabs, as Phillips offered a 7-9 August cargo at Dated +$1.75 and Totsa bid 10-12 at $1.50 over Dated. Despite this plethora of offers, nobody came together to trade and the physical differential bounced to 77.5c.

As noted earlier, The Officials sent a list of questions to Platts and we thank them for answering! We are still waiting for a reply from IFAD on similar issues.
Back to Platts, as you market practitioner know so well, Murban has been behaving erratically and has even plunged below the price of heavier Upper Zakum. Murban features in the delivery mechanism for Dubai partials and the price inversion, wherein Murban priced below heavier grades, has dragged down the assessed price of the main crude benchmark for the Middle East and Asia. As market sources replay the saga, many affected benchmark price users, including ADNOC, put pressure on various entities to address what they perceived as a pricing anomaly.

Dumper time! Just before the London close Brent plummeted more than $1, coincidentally as the UK joined in the party to spank yet more sanctions on Russia. Like the EU, the Brits lowered the price cap to $47.60/bbl – maybe they’re just desperate to get some deeply discounted crude to feed the beleaguered Lindsey refinery. The dump was coincidental in the timing as the oil market does not care what Europe has to say. The Russians and Chinese don’t care and they are the big ones that matter. But for good measure the Indians officially don’t care either! Hey, they have a lot of mouths to feed and they’re not listening nor following any unilateral sanctions, only UN ones. Just to be clear, the Chinese and Russians have a veto, so forget about UN sanctions. By the close, Brent had fallen back to $69.55/bbl. The prompt spread had been enjoying the gradual rise through the session, back above $1 – but also dumped in the window to 91c.

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Brent remained in the $68/bbl lever before charging ahead back to the $69 handle. A trader notes, ‘there is a lot of buying at the $68.50 level.’ The late London rally took it to $69.40/bbl. By press time. The prompt spread has rebounded from its low at under 80c yesterday to 94c by today’s close. As Brent traded in a comfy range today, the broader markets have largely recovered from the wobble and panic that Powell would be booted, with the USD strengthening again, while equity markets climbed and treasury yields fell slightly. Trump should know by now that the bond market is king and not him. Gold slid significantly, dropping 0.7%, while other metals, including platinum, continued their rally.

Top heavy? Short sell?  Nvidia’s been a massive driver of the last few months of stock market rally and has even exceeded the GDP of major countries! It’s market cap is now bigger than the GDP of Canada, the UK and India – and Germany’s next on the hitlist. In terms of market capitalisation, Nvidia is bigger than all but 5 national stock markets!  Only Hong Kong, India, Japan, China and the US itself are the only ones bigger! The stock market’s centre of gravity looks somewhat high, with such a mammoth share in a single company, and don’t look too closely at the price-to-earnings ratio! The impact of a correction on Nvidia will make us all cry. Get your handkerchiefs ready. Sanctions and secondary tariffs on Russian oil could put up another hurdle for India’s economy, as you’ll find out on page 2… But they don’t care.

An update regarding our Murban questions we asked Platts: We had a preliminary discussion with our fellow publisher, and they will prepare their answers in writing. We agreed this way is better as nothing will be lost in translation, so to speak. The issues are highly technical, and the company is still receiving comments. While we were supposed to be asking questions, they asked some of their own. We highlighted some issues including the fact that the proposal contains an inequity with the 50% discount one way and a 100% the other way. Dear reader we will be keeping you abreast of developments! In the meantime, we are still waiting for a reply from IFAD. Brent got dragged through the ringer today, dropping in the European morning and hoping Team America may come in to save the day. But they didn’t… And by the close flat price had tumbled to $68.02/bbl, even falling below $68 several times. The front spread has been whacked, clobbered and slapped this week. And it’s showing few signs of being out of the woods. From a peak at $1.28 on Monday, it has plummeted to just 80c today. Further down the curve, things held relatively steady as the front sold off – the monthly spreads managed to retain a few cents of backwardation until the July/August 2026 spread, after which things shift into a gentle contango.

The US administration is increasingly seen as a strident noise-maker with no substance and it’s risking not being taken seriously. The statements by the secretary of energy regarding the non-exemption approach to tariffs on energy products, should have resulted in a massively higher price down the curve and a major mess in the US gasoline prices in the US East Coast because the area is dependent on imports. But the market ignored the entire thing. This means that the US has reached the irrelevance stage. ‘They won’t implement what they said, they can’t,’ said a source in the Middle East, echoing what European and Asian sources said earlier. ‘They say one thing and then they change their mind,’ said the source.

In a major act of self-harm, the US administration paraded Energy Secretary Chris Wright in a Bloomberg TV interview where he stated there would be no tariff carve for US energy imports. Among other issues, this would totally harm the US in its jet requirements, some of which comes from Korea into the US West Coast, Gasoline into the US East Coast or all of its heavy crude oil refining industry. It would cause a major mess, sources concluded, calling it “madness.”

In the week ending 11 July 2025 exchange traded futures volumes rose w/w across all instruments and across the three front tenors, following the decline in traded volumes of the week ending 4 July. Brent and WTI saw the biggest increase in exchange trade volumes in the November contract, up 38.24% and 66.14%, respectively. Meanwhile volumes in September and October contracts for WTI jumped over 57% w/w.

Recurrent rumours of China stocking up crude for its national reserves were fuelled last week by a rising price and data indications that shipments from Iran and Iraq had gone up – as we reported yesterday, Vortexa also saw 600 kb/d more imports from Iran in June. Oil prices were buoyant but a belated acknowledgment by the general oil press noting the deluge of extra Saudi oil production cooled the exuberant feeling like an evening summer shower. And just as prices tanked back down towards the sub 70 mark, Energy Aspects drew further attention to the alleged Chinese buying and estimated a surge in extra imports of around 785kb! Party time again, right? 🤣