All of last week, Brent futures were comfortably trading at $85/bbl. Now (at time of recording), they're trading around $82.50/bbl. There is a definite bearish turn to the rangebound wave we were in last week. WTI has seen more bullish interest, and it's just entered negative handles in CTA data. WTI also sold off aggressively on 19th July from  $81/bbl to $78/bbl. Volatility has also risen significantly for both Brent and WTI - especially in comparison to low volatility all year.
 
Overall, refinery margins can be summed up as not bad, but also not good. Primarily driven by the weakness in crude, gasoil cracks gapped up higher by $1 late Monday afternoon. Aug’24 gasoil cracks were up from $18.50/bbl to $19.30/bbl.
 
Interestingly, the market for naphtha - which is a market most suspectable to geopolitical concerns - has been strong. Butane margins have also risen significantly. The increase in profitability comes from a more significant US butane demand.
 
Looking to macro femands and the One to Watch; China Central Bank's actions have been interesting. China’s PBOC central bank cut rate early Monday morning 10bp across the yield curve to try and stimulate growth. Off the back of this, Greg and James discuss if deflation is something we need to be worried about in Europe this year and next.
 
Vincent discuses some key headlines in our Googling Oil segment, including; Russia Considers Building Oil Refinery in Cuba, Slovak PM Blasts Ukraine’s Lukoil Sanctions As Oil Flow Stops and Why Nigerians are praying for the success of a new oil refinery.
 
As for the Trade Idea this week, Vincent suggests going Short brent Dubai.

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If you would like to connect with any of our hosts on LinkedIn, please click on the hyperlinks below:
Greg Newman:   https://www.linkedin.com/in/oilderivatives/
James Brodie:   https://www.linkedin.com/in/jamesbrodiecmt/
Mita Chaturvedi: https://www.linkedin.com/in/mita-chaturvedi/
Vincent Wu:   https://www.linkedin.com/in/vincent-wu-099816125/

Chapters for this episode are: 
0:00 Introduction
0:58 Brent Futures update
05:48 Managed money discussion
7:00 Bullish banks
16:40 Refinery margin update
26:21 Macro demand
40:22 One to watch (key data)
40:50 "Googling oil:" world oil news 
47:38 Trade idea