Robust oil demand from China – ING

The oil market rose for a second straight session in the early trading session today, following claims by Ukraine that recent drone attacks affected Russia’s two key oil hubs in the Baltic Sea. Recent reports suggest that the latest strikes temporarily suspended crude operations at Primorsk port, Russia's largest oil-loading port, at the end of last week. Meanwhile, there are suggestions that three pumping stations pushing crude to Ust-Luga were also targeted, ING's commodity experts Ewa Manthey and Warren Patterson note.

Cpeculators reduce their net long in ICE Brent

"Chinese data released this morning shows refiners processed almost 15m b/d of crude oil in August, up 7.6% year-on-year, following robust imports and higher domestic production. In addition, apparent oil demand in the country rose to 14.53m b/d last month, up 4.9% YoY."

"Meanwhile, the recent Baker Hughes data shows that oil drilling activity in the US expanded for a third week straight, as crude oil prices recovered amid growing geopolitical risks. The number of active oil rigs in the US rose by two over the last week, leaving the total number of oil rigs at 416, the highest level seen since mid-July."

"The latest positioning data shows that NYMEX WTI saw aggressive speculative selling, with managed money net longs declining by 14,630 lots to 12,657 lots in the week ending 9 September. This is the least bullish position on record that speculators have held in WTI since June 2006. Similarly, speculators reduced their net long in ICE Brent by 41,476 lots to 209,578 lots over the reporting week. The move largely follows OPEC+’s latest decision to boost its oil production, along with the IEA’s latest projection for a record oil surplus for the next year."