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Welcome back to Trading Corner. Manny and James break down the latest moves in crude and product markets.

This episode of Trading Corner dives into the latest market trends, breaking down recent shifts in oil prices, refinery margins, and the broader financial landscape. The hosts chat about how geopolitical events, financial pressures, and supply-demand dynamics are shaping the market, sharing their takes on what could happen next. They also discuss trading strategies, the impact of turnarounds, and whether the current bearish sentiment will stick around.

Tune in as Manny and James analyse the data, the market’s reactions, and what to expect.

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On the agenda this week is the evolution of trading culture. Plus - how did we build our research team here at Onyx? And - how much recognition are financial flows getting in the derivatives market today?
Greg Newman
https://www.linkedin.com/in/oilderivatives/
Vincent Wu:
https://www.linkedin.com/in/vincent-wu-099816125/
Audrey Byrne:
https://www.linkedin.com/in/audrey-byrne-a32009183/

Although the market and the narrative want to be bullish, there's no impetus for it to be there. It's a weak week in Brent futures, after being within in touching distance of $88/bbl. We've seen both long and short prod/merc in Brent 200mb in 2 weeks in Sep 0I. The team explains why bearish economic data from China is adding to the pressure of oil prices.
Greg, James, Martha and Vincent discuss Iraq, Kazakhstan, and Russia having to submit compensation plans for exceeding quotas in 2024. The OPEC+ Joint Ministerial Monitoring Committee will assess compliance on August 1, and Iraq’s management and its relationship with the KRG are crucial for OPEC+ compliance and global oil stability. While this isn't massive news just yet, there's so much lying beneath the surface of this story, which is leading to people getting nervous on the producer side as a summer rally is yet to come to fruition.
The sentiment of extra supply is being supported by crude loadings from Guyana, which are planned at 21 million barrels, (or 700,000bb/d) in September, according to programs seen by Bloomberg. This daily volume will be a new record, compared with a revised 613,000 b/d in August. The July volume was also revised higher to 452,000 b/d.
Looking to macro news, there was disappointing data out of China with GDP 4.7% YoY (est 5.1%) retail sales 2.0% (est 3.3%). CPI 0.2% YoY, PPI –0.8%. House prices in China fell 4.5% YoY in June, the most in 9 years. U.S. prices 28bp cuts in September, 67bp cuts by year end. Weak CPI and the Fed is now concentrating on the weaker economy.
The team discuss Trump's impact on oil and suspect he will want to be bearish and take credit for lowering gasoline prices with a target range of between $60/bbl and $65/bbl, whilst simultaneously putting pressure on the central bank in hopes to restimulate the economy.
The trade idea for this weak is to buy heating oil. With such a heavy contango in the heating oil spreads it's a good risk reward-trade to buy. We're also seeing strong harvesting in corn and wheat, so if that continues, we'll most likely be seeing some more demand there.
Chapters for this episode are:
0:00 Welcome
0:52 Brent Futures, OPEC, and production
12:04 Macro market news
19:04 "Googling oil:" world oil news
24:33 Refinery margins
26:40 Trade idea of the week
30:29 Poll results and outro

Welcome to the second episode of Oil Insights, hosted by Harry Tchilinguirian, Head of Research at Onyx, alongside co-hosts Mita Chaturvedi and Vincent Wu, members of the research team at Onyx.

The oil market started last week on a strong note, only to finish on a whimper trading sub-80s last Friday. Geopolitics early last week did help uplift prices, with fund positioning ready to add some more risk. But geopolitical premia seemed to deflate as diplomatic efforts were stepped up to try to secure a cease-fire in Gaza.
The positive economic news from the US, such as strong retail sales, provided some optimism, but the main focus remained on China's weak economic data. China's industrial production, retail sales, in fixed investment were disappointing, alongside weaker crude runs and oil imports. US oil data from the EIA also showed an unexpected crude stock build, further pressuring oil prices.

Brent remained stable, with no significant signs of change in supply. China reduced gasoline and diesel exports in July, and its refineries are likely to operate below expectations due to weak demand and export constraints. The future of crude demand in China and Asia is crucial, especially with OPEC+ potentially increasing supply in Q4. Refining margins are also struggling, particularly with gasoline and diesel.

As for swap market pricing, the DFL still remains quite strong, although slightly weak compared to this time, last week. It’s seen a combination of short-covering rally as well as, Trade Houses and Majors buying in the physical window, which drove up physical differentials indicating demand in the spot market in the near term.

Middle distillates have been interesting this week, with gasoil pressured due to the poor economic picture, seeing a poor economic picture across China, the United States, Europe and especially Germany, with extremely weak PMI data and industrial production.

This special episode of Macro Mondays LIVE from Singapore aired at 12pm GMT on Monday, 10th February 2025.
Join us every Monday at 12:30 PM UK time for Macro Mondays LIVE with James Brodie, as we unpack the major developments shaping global markets and look ahead to a pivotal week.
Key highlights this week:
- We're seeing stronger US economic data and employment data - but Fed is still wary of inflation.
- Chinese tech stocks are looking strong.
- Bank of England cut 25bp - but central bank warns of inflation.
- Trump is still looking to lower oil prices.
- Gold hits new all-time highs.
Key Data Releases This Week:
Tuesday: Fed Powell testimony, UK retail sales
Wednesday: US CPI
Thursday: US PPI, UK GDP, EZ IP
Friday: US retail sales & IP, EZ employment
Tune in for expert insights, actionable analysis, and an in-depth look at how these shifts impact the markets and your strategies. Don’t miss it!

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