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For a special episode of Oil Insights, Harry Tchilinguirian, Group Head of Research, is joined by Dr Michal Meidan, Head of China Energy Research at the Oxford Institute for Energy Studies, for a special edition of our podcast today focused on China. 

In this episode, Harry and Michal explore China's oil demand outlook as institutional forecasters, including the IEA and OPEC, alongside prominent Wall Street banks, downgrade their views. They discuss how weak macroeconomic data, coupled with challenges in government policy stimulus, cast doubts on China's ability to achieve its targets and deliver on oil demand growth.

Harry and Michal review oil product demand in China, particularly how the shift towards electric vehicles affects gasoline demand. Naphtha and propane demand from the petrochemical sector are also discussed in the context of weakening margins. Finally, substitution toward natural gas is also examined to see how it affects the diesel outlook. Join Harry as he delves into these pressing issues with Dr Michal Meidan, as China's oil demand performance will have important implications for the global oil balance at a time when the OPEC+ group is pondering adding more oil to the market.

China saw its weakest manufacturing PMI data since February this week, with a fourth consecutive contraction. In the US, PCE inflation data came in below expectations, while Q2 GDP and consumer confidence came in higher. The Q2 GDP data is very backward looking, and this week’s U.S. PMIs and employment data are of critical importance - particularly with the next Federal Reserve central bank meeting on 18th September.

The Fed seems dovish, key data shows manufacturing and employment slumping, and private sector job creation has plunged to six-year lows while government jobs surge to all-time highs. Housing data also looks poor in both the US and China.

In equities, there's been a sharp increase in net short positions in the S&P 500, and Indian stocks are up for a record 13th straight day. UK shop prices are now in deflation, and German GDP has officially barely risen in six years. Hedge funds are bullish on gold, and coffee is reaching an all-time high. The team also discusses Central Bank OIS pricing, USDJPY, Brent, Nvidia, and more.

The key data releases this week are:

Tuesday:
-U.S. ISM mfg. PMI

Wednesday:
-JOLTS job openings
-Fed Beige book
-BOC rate decision

Thursday:
-Jobless claims
-ADP employment
-U.S. ISM services PMI

Friday:
-U.S. jobs report

In the latest episode of The Officials, special guest Michal Meidan, Director, China Energy Programme at Oxford Institute for Energy Studies joins Jorge Montepeque, Harry Tchilinguirian, Vincent Wu and new Official Edward Hayden-Briffett to discuss China’s impact on the financial energy market and demand.

The picture isn’t pretty for China at the moment. Sentiment is weak and it’s been a difficult year for the economy, with real estate downturn and expenditure down as well. The east is also seeing fundamental changes to the structural economy such as the growth of EV’s and robots. The Officials discuss where China’s supply and demand for energy products could go next.

We hope you enjoy our seventh episode of The Officials, a new show from the team behind Onyx’s Benchmark Publication and helmed by Jorge Montepeque the architect of benchmarks and services that shape our world today.

To read the latest report by The Officials, click here; https://www.onyxhub.co/news/all/the-officials-asia-29-08-24/

Welcome to the third episode of Oil Insights, hosted by Harry Tchilinguirian, Head of Research at Onyx, alongside co-hosts Mita Chaturvedi and Martha Dowding. 

Despite the vanishing trading volumes amid the holiday in the UK, it has been anything but a quiet beginning to this week, with the front month Brent futures contract firming to an intraday high of $81.50 on Monday. Tensions in the Middle East, dovish remarks by Fed Chair Jerome Powell, and tensions surrounding Libya's crude oil production have all engulfed the oil market. 

Dated Brent also found strength, with the front-month DFL rallying to $1.40/bbl. However, CFTC data for the week ending 20 Aug showed money managers remaining bearish. Coupling this with Onyx's CTA positions trending towards max net short, this prompted the question: Are the bears still lurking despite this newfound bullishness? The price action on Brent futures on Tuesday would tend to suggest so, with the soon-to-expire front-month October contract down by over 2% by 6 pm BST. 

The bullish sentiment was also seen in fuel oil. Singapore VLSFO cracks have seen remarkable performance, driven by factors such as increased bunker fuel demand, buying in the physical window, and depleting inventories. However, as open interest continues to skyrocket, one questions whether saturation has hit too close to the sun. 

Going forward, we'll keep our eye on the upcoming October Brent futures expiry. The Oct'24 and Nov'24 futures flat price contracts are currently around $1 within each other, and whether the expiry causes a roll up or a roll down in the new prompt will be one to watch. Finally, to add to the uncertainty, OPEC+ has been....quiet lately. Are we currently in the calm before an OPEC-news driven storm? 

We’d love to hear from you! If you’d like to get involved with our podcast, please leave a comment. You can also watch this podcast on the World of Oil Derivatives YouTube channel.

Please note, this episode was recorded on Friday 23rd August at 17.00. 

Macro Specialist James Brodie and Trader, Director James Todd  delve into Powell's Jackson Hole testimony, the weak manufacturing PMI globally and UK inflation below expectations. They also take a look at inflation within the UK and the soft prices we've been seeing in crude oil over the past week. 

James Brodie and James Todd look into the OIS pricing to see what's priced by the central banks in the forthcoming central bank meetings and also look at the week ahead, including; key markets, trends, charts and risks. 

Chairman Powell's Jackson Hole testimony that came out on Friday, basically said, he was dovish, however, he made it clear that the Fed would be data dependent. We expected exactly this because the OIS is pricing between 25 and 50 basis points of cuts at the September meeting, giving the Feds a month to watch the data. Although Powell clearly didn't want to have to paint them into a corner 25 or 50 this far in advance. He said. We do not seek or welcome further labour market cooling, so they're clearly, quite concerned about employment. 

The key data to look out for this week is; 
    
Tuesday; U.S. consumer confidence, German GDP
Wednesday; FOMC minutes
Thursday; Euro area CPI, US Q2 GDP update, jobless claims
Friday; U.S. Uni Michigan consumer confidence


#jacksonhole #Testimony  #Powell #PMI  #Fed #employment #UK employment #macroeconomics

There are a few issues to discuss on the sixth episode of The Officials, the main one being that the oil markets have been correcting. If you've been reading The Officials, you will have seen that the team have taken a negative stance on the global economy and the oil markets.

The Officials discuss the state of China, where data is showing indicators are quite negative, but what is attracting the interest of the team are results by Western companies for the first half of the year, where we're seeing many CEO's recently left their businesses and industries entirely. The indicators, in The Officials opinion, conclude that China is weak, perhaps even contracting.

To read the latest report by The Officials, click here; https://www.onyxhub.co/news/all/the-officials-dubai-holds-up-just-dont-look-at-the-asian-macros/

We hope you enjoy our sixth episode of The Officials, a new show from the team behind Onyx’s Benchmark Publication and helmed by Jorge Montepeque the architect of benchmarks and services that shape our world today, with guest speakers Harry Tchilinguirian, Vincent Wu and Will Cunliffe.

Last week Greg discussed the role of hedge funds and their impact on oil markets in the past year. There has been plenty of hearsay and gossip from within the industry in response to the publishing arm of Onyx Capital Group, namely, The Officials. 

Host of The Officials and Director of Benchmarking, Jorge Montepeque, joins Group CEO Greg Newman to explain why pushing for greater transparency sparks an old style backlash. For the avoidance of doubt, it's important to note, Onyx Capital Group has autonomously-ran subsidiaries and departments, one of which is a Publisher, which is entirely independent of the trading arm.

Evidently, there are a few bad actors who didn’t appreciate the transparency our media displays regarding the inner workings of the industry. We received increased scrutiny regarding our transparency on how the oil swap benchmarks are priced. The latest incident was the largest of the PRAs, Platts, contacting Onyx Capital Group directly to complain about these reports, whilst failing to specify which reports or podcasts when asked to do so. This is a legacy or knee jerk industry move. All of Onyx Capital Group's reporting is based on facts, using publicly available information and by exercising freedom of expression.

On this episode, Greg digs deeper into this tension, and discusses the challenges of bringing transparency in oil derivative markets to the surface. Jorge Montepeque, the man who built the Platts indices that oil swap contracts price against – and who now runs The Officials at Onyx Capital Advisory joins him. Jorge is no stranger to receiving backlash, bullying and threats from a few bad apples in the oil market and he joins Greg to explain why. 

#oott #oil #oilandgas #energy #derivatives #trading #trader #podcast #news #economics #finance #markets #marketanalysis #derivativestrading 

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. 

RBNZ cut rates 25bp in a largely unexpected move. Meanwhile, there's some weak data out of the U.S.: Core goods CPI has plunged even further into deflation (-1.9% YoY), with PPI and industrial production also weak. On the other hand, U.S. retail sales are up and initial jobless claims are down.
 
Euro area industrial production has fallen 0.1%MoM and 0.5% - BBG.
 
In the U.S., Chapter 11 filings are the highest they've been in a decade; home buyers' sentiment has dropped to record lows; and inventory levels have hit the highest level since 2008.
 
James and James also address mixed data out of China, challenges in the iron ore market; a 0.5% MoM increase in UK retail sales; Bitcoin; gold; USDJPY and more.
 
The key data releases this week are:
Wednesday - FOMC minutes
Thursday - U.S. Euro area & UK PMI's, U.S. jobless claims
Friday - Chair Powell's Jackson Hols speech, Japan CPI

The Officials are back to discuss the latest market developments in the past week. You can also read The Officials latest report What goes up must come down, says wise ops guy here; https://www.onyxhub.co/news/all/the-officials-what-goes-up-must-come-down-says-wise-ops-guy/

This week, the API showed crude inventories going up by 5.2/million bbl. Upon the APIs release, there was almost no reaction in flat price to the huge inventory drop. As the market received this 'bullish' inventory data the market did nothing at all. Jorge asks, was that the right decision or the wrong decision? But then the EIA released data showing a 'bearish' 1.36 million bbl increase, and then the market fell by 30 cts in two minutes. So, what is the data to trust? Who from and when?

But other data is equally conflictive and companies are making important decisions on data that seems faulty.

We hope you enjoy our fourth episode of The Officials, a new show from the team behind Onyx’s Benchmark Publication and helmed by Jorge Montepeque, the architect of benchmarks and services that shape our world today, with guest speakers Vincent Wu and Will Cunliffe.

Jorge Montepeque  https://www.linkedin.com/in/jorge-montepeque-38410bb6/

Vincent Wu https://www.linkedin.com/in/vincent-wu-099816125/

Will Cuncliffe https://www.linkedin.com/in/will-cunliffe-45899a182/