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Outlook: Oil prices have fallen lower this morning as we head into the OPEC+ policy meeting. The producer group is currently expected to stick to its original production plan of adding back 400,000 bpd each month until the end of December. OPEC was also seen raising its 2022 oil demand forecast to 4.2 million bpd from the previous 3.28 million. This will likely keep the group from pausing any planned production increases. Markets also look towards this morning’s Weekly Petroleum Status Report as it is expected to show a sizable draw in crude stocks. A Reuters poll pegged crude inventories down by 3.1 million barrels for the week ending August 27, while API figures reported at 4 million barrel draw.  

Crude

• Russia’s Deputy Prime Minister Novak sees global oil demand rising by 5.8 to 6 million bpd in 2021 before fully recovering in 2022. Novak also stated that Russia is in full compliance with the OPEC+ deal and stressed the importance of keeping the oil market balanced.
• Iraq’s oil exports rose to 3.054 million bpd in August compared to 2.9 million bpd the month prior.
• A poll of six refiners sees Saudi Arabia cutting prices for most of its crude grades sold to Asia in October due to the weakening of the Middle East benchmark Dubai.
• The October crude oil contract is trading $1.11 lower at $67.39. The 20-day and 100-day moving averages are $67.4 and $67.26 respectively. The 14-day RSI is 49.34%.
• As of 8:30 am CST: October Brent is down $0.75 at $70.88 and the U.S. dollar index is 0.163 lower at 92.463 while the nearby e-mini S&P 500 futures contract is up 7.5 points at 4528.

Diesel

• India’s diesel sales for August were up by 16% compared to the same month in 2020, but still down by 10% compared to August of 2019.
• Yesterday afternoon’s API figures reported a 2 million barrel draw for the week ending August 27.
• During the last week of August, airlines across Asia-Pacific nations offered just 22.2 million seats, the lowest figure seen since February of this year.
• The October ULSD contract is trading $0.0318 lower at $2.0984. The 20-day and 100-day moving averages are $2.0692 and $2.0641, respectively. The 14-day RSI is 53.29%.

Gasoline

• Marathon reported that its 578,000 bpd refinery in Garyville Louisiana only suffered minor damages due to the Hurricane. Marathon’s Garyville location is the largest capacity refinery in Louisiana.
• Yesterday afternoon’s API figures reported a 2.7 million barrel build for the week ending August 27.
• India’s gasoline sales were seen staying above pre-pandemic levels in August as people preferred to use personal vehicles rather than public transportation. Gasoline sales were up by 4.1% compared to August 2019.
• The October RBOB contract is trading $0.0371 lower at $2.1048. The 20-day and 100-day moving averages are $2.0812 and $2.0281, respectively. The 14-day RSI is 53.11%.

Propane

• An OPIS survey estimates today’s weekly inventory report to show a 1.37 million barrel build for the week ending August 27. The five year average for the comparable week sits at a 3.2 million barrel build.
• At last look, Conway propane was trading up $0.01500 at $1.17000. Mt. Belvieu was trading up $0.01000 at $1.16500.