Global product markets weekly: Margins rose as US gasoline inventories fell

The oil market fell last week, following six consecutive weekly increases. North Sea Dated crude’s weekly average eased US$0.28/bbl to US$76.06/bbl in the week to 9 July. Prices declined sharply into mid-week after OPEC+ failed to reach an agreement on production increases, undermining confidence in the groups cohesiveness and future policy. By the end of the week prices had rebounded strongly, following Thursday’s release of the weekly EIA oil inventory report. The global spread of the Delta variant of Covid-19 remains a downside risk to oil demand, particularly in South America and Asia. Our ex- RVO global composite refining margin rebounded US$0.73/bbl, from four-month lows to US$1.88/bbl. Margins in Asia led the weekly increase as gasoline and diesel cracks strengthened further over concerns that Chinese exports will be substantially lower, while naphtha rose on petrochemical feedstock demand.