New Shanghai Lockdowns Pressure Crude Market
June 10, 2022
The news out of Shanghai that new COVID lockdowns were being put in place pressure crude price yesterday, but refined fuels products rallied higher on lower inventories for gasoline and good demand.
Norway’s production is potentially going to be disrupted as there is a possible oil workers’ strike starting Sunday.
OPEC+ said at their last meeting that they would produce some extra barrels which netted out to be roughly 216,000 bpd more which is a drop in the bucket. The total additional barrel is 648,000 bpd and JP Morgan and Chase analysts think less than a quarter of that number will make it to the market as many OPEC+ producers cannot reach their current quotas due to a lack of investment when crude prices were low.
The consumer price index number just released this morning saw an increase of 1% from April and to an 8.6% annual number. Shelter, food, and gas were the biggest contributors to the increase. The core CPI which takes out the volatile food and energy components, rose 0.6% from the prior month and 6% from a year ago, this was above expectations.
Iran has dealt a near fatal blow to the chances of reviving the 2015 nuclear deal as it began removing essentially all the International Atomic Energy Agency monitoring equipment installed under the deal, IAEA chief Rafael Grossi said.
Reuters reported that Russia’s oil revenues are higher than pre-invasion levels. Even with sanctions, sales to China and India at discounted prices, these discounted prices are still higher than pre-invasion levels.