Bearish Q4 narrative remains warranted, with some bullish nuance
Commentary summary:
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Latest inventory data in Europe saw product draws in August amid surprisingly low runs.
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Low stocks now leaves spreads sensitive to supply/demand surprises ahead.
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But US refinery runs look increasingly strong as opposed to being under pressure economically.
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Crude premia and fuel oil are raising margin signals but could be easily snuffed out.
The latest JODI data for August confirmed what various product spreads (with the exception perhaps of gasoil) were telling us for the last month; that the prompt market has been tight over Q3, while deferred markets are seen long.
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