Global product markets weekly: Tightening crude supply undermines margins

For the week commencing 02 July, weekly average crude prices strengthened as Libyan crude exports were disrupted further and Iran output continued to decline. Force majeure was applied at Libya’s Marsa el-Hariga and Zuetina loading ports. Over the last three weeks, Libyan crude production has halved to 530 kb/d. The Brent-WTI spread remained narrow as Syncrude Canada’s upgrader has cut Canadian crude output by 10%. There was a crude stock draw at Cushing which negated the effects of a surprise build in US total crude stocks.