Global products market weekly: Refining margins recovered as crude prices fell

The oil market weakened at the start of the week as OPEC+ announced the extension of their voluntary cuts to September 2024, with the opportunity for volumes to return to the market from then. Further downward pricing pressure was from the higher-than-expected rise in EIA crude oil and refined products inventories. However, later in the week, oil prices increased as the European Central Bank and Bank of Canada reduced interest rates, and there was anticipation that the Federal Reserve would do the same in September of this year, though US non-farm payroll growth beat expectations. North Sea Dated crude’s weekly average declined by US$4.87/bbl, in the week ended 7th June. Our ex-RVO global composite refining margins expanded by US$0.71/bbl to US$4.86/bbl, owing to a sharp rise in product cracks in Asia and ME due to a sharp decline in outright crude prices. Weekly margins were at US$0.44/bbl below the five-year historical average for the same week (excluding 2022).