OIL FUTURES: Crude rises on lower US crude stock expectations

Crude oil futures were higher in midafternoon trading in Asia Nov. 26, buoyed by an anticipated decline in US crude oil stocks, as market participants measured expectations on whether Israel's government would vote in a ceasefire deal in Lebanon.

At 3:15 pm Singapore time (0715 GMT), the ICE January Brent futures contract was up 26 cents/b (0.36%) from the previous close at $73.27/b, while the NYMEX January light sweet crude contract was up 20 cents/b (0.29%) at $69.14/b.

"WTI crude fell 3.2% to $68.90/b on a potential Israel-Hezbollah ceasefire. The focus is also on Ukraine-Russia tensions and Iran's nuclear plans. OPEC+ may keep production cuts, with a meeting on Dec. 1," said Saxo APAC Research Nov. 26.

While crude prices were comparatively softer at the start of the week against the previous week ended Nov. 22, geopolitical tensions still threatened supply amid ongoing clashes between Israel and Hamas as well as Russia and Ukraine.

"Oil prices fell more than 2% on Monday after multiple reports that Israel and Lebanon had reportedly agreed to the terms of a deal to end the Israel-Hezbollah conflict," said UOB analysts in a research note Nov. 26.

US crude oil stocks likely moved lower in the week ended Nov. 22, analysts surveyed by S&P Global Commodity Insights said Nov. 25, amid an expected uptick in refinery demand.

Forecasts of significantly colder US temperatures by late November across much of the Midwest and eastern United States could see demand for distillates jump in coming days. According to a 14-day forecast published by Commodity Insights, US heating demand will begin rising sharply in the days leading up to the Nov. 28 US Thanksgiving Holiday weekend.

OPEC+ is set to hold a ministerial meeting scheduled for Dec. 1 online, rather than in person in Vienna, sources within the group said Nov. 25.

Low prices are leading some analysts to forecast that the group will further delay plans to bring some barrels back to market from January 2025.

OPEC+ has already twice delayed easing voluntary production cuts totaling 2.2 million b/d due to market conditions.

Dubai crude

Dubai crude swaps and intermonth spreads were lower in midafternoon trading in Asia on Nov. 26 from the previous close.

The January Dubai swap was pegged at $71.61/b at 3:15 pm Singapore time (0715 GMT), down $1.11/b (1.53%) from the previous Asian market close.

The December-January Dubai swap intermonth spread was pegged at 37 cents/b, narrower by 1 cent/b over the same period, and the January-February intermonth spread was pegged at 40 cents/b, unchanged over the same period.

The January Brent-Dubai exchange of futures for swaps was pegged at $1.64/b, down by 9 cents/b.