- Oil trades slightly higher as demand concerns counter tighter supply outlook
- June ’23 WTI gained nearly 3c this morning to trade around $71/Bbl
- Crude prices slightly fell from Monday's gains following the release of weaker-than-expected Chinese industrial production and retail sales data for April
- Despite concerns about potential demand weakness, China's refineries are operating at near-peak capacity in anticipation of demand recovery
- The market is closely monitoring the potential U.S. debt default and awaits updates on when the U.S. will start refilling the SPR
- Russian fuel-oil exports to China set to hit an all-time high in May (BBG)
- Russian fuel-oil exports to China are expected to hit record highs in May (over 0.35 MMBbl), driven by smaller Chinese refineries increasing their use of fuel oil for blending, according to Kpler
- Chinese 'teapot' refineries seek fuel oil alternatives amid reduced crude quotas, driving Russian refiners to increase supply
- Currently, Russia supplies around 35%-40% of all fuel oil imported by China, according to Kpler’s Viktor Katona
- Despite the buying spree, China's fuel oil imports may decelerate as over half of the 2023 quota of 16.2 million tons (around 121 MMBbl) for non-state plants could have been used by April's end, per Energy Aspects