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Energy and commodity highlights: Tanker attacks, biofuels and oil, spiraling naphtha prices

Summary:
Global oil markets were jolted late in the week by reports of attacks on two oil tankers near the Strait of Hormuz on June 13. Brent crude futures climbed almost 4% immediately after the attacks. ICE Brent eventually settled .34 higher at .31/b, and was trading higher the morning of June 14. The US was quick to blame the attack on Iran, saying it was orchestrated by the country’s Islamic Revolutionary Guard Corps, in response to US economic sanctions on Iran. Click for full-size infographic Go deeper: S&P Global Platts’ Factbox on the latest attack in the Gulf of Oman It remains to be seen whether the current risks to oil supply in the Middle East will offer sustained support to oil prices. However, Platts Analytics pointed to potential for higher Brent crude levels in the second

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Global oil markets were jolted late in the week by reports of attacks on two oil tankers near the Strait of Hormuz on June 13.

Brent crude futures climbed almost 4% immediately after the attacks. ICE Brent eventually settled $1.34 higher at $61.31/b, and was trading higher the morning of June 14.

The US was quick to blame the attack on Iran, saying it was orchestrated by the country’s Islamic Revolutionary Guard Corps, in response to US economic sanctions on Iran.

Infographic on June 13 tanker attack near strait of Hormuz

Click for full-size infographic

Go deeper: S&P Global Platts’ Factbox on the latest attack in the Gulf of Oman

It remains to be seen whether the current risks to oil supply in the Middle East will offer sustained support to oil prices. However, Platts Analytics pointed to potential for higher Brent crude levels in the second half of the year.

At a briefing in London, Chris Midgley, head of Platts Analytics, pointed to refinery re-starts after maintenance, and a year-end spike in refinery runs due in part to IMO 2020, as bullish demand factors for oil.

LISTEN: Novatek’s Mark Gyetvay on LNG, US sanctions and trade tensions

Mark Gyetvay, CFO and deputy chairman of the management board at Novatek, visited Platts for an interview with senior writer for LNG, Lucie Roux. They discussed how the Russian gas producer intends to boost output, and how it is coping with US sanctions and heightened tensions on trade.

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Iron ore prices may fall on global supply, higher scrap use in China: panel

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PETROCHEMICALS

NWE petrochemical producers reap benefits of cratering naphtha

The Northwest European naphtha market has continued to struggle, with cracks reaching a 29-week low late-last week, but the weakness upstream has yielded downstream benefits for petrochemical makers, with cracker margins hitting a near two-year high.

AGRICULTURE/BIOFUELS

Trump says E15 expansion will curb US oil import dependence

The approval of year-round access to E15 fuel will curb US dependence on imported oil by as much as 250 million barrels/year, US President Donald Trump said.

GAS

Gas-fired generation could see more battles under Bloomberg campaign

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THE LAST WORD

“If this philosophy prevails, everyone in this room knows full well what the consequences will be. It will impact our entire way of life.”

US Energy Secretary, Rick Perry, lambasted individual states’ actions blocking new gas infrastructure and banning fracking, and raised alarm over fast-paced coal and nuclear plant retirements.

The post Energy and commodity highlights: Tanker attacks, biofuels and oil, spiraling naphtha prices appeared first on Platts Insight.

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