Analysts from J.P. Morgan Global Research take a closer look at the stories behind some of the biggest trends, themes and developments in markets today.
Episodes
Friday Jan 27, 2023
Friday Jan 27, 2023
Natasha Kaneva is joined by John Royall, Head of the US Integrated Oils & Refining equity research team to discuss the outlook for refined oil products like diesel ahead of the February 5 European embargo on imports of Russian oil products. Brent oil price has gained 13% from the bottom reached on January 4 to trade at $88/bbl, $5 above our model-derived fair value for January. While optimistic demand expectations from China’s reopening have helped oil regain December losses, we believe soaring middle distillate prices and cracks are mostly behind crude’s bullish price action. We expect volatility in distillate cracks and prices in 1Q23 around embargo implementation but see market imbalances clearing by 2Q23 and risk premium dissipating as Europe and Russia had a year to prepare.
Speakers
Natasha Kaneva, Head of Global Oil and Commodities Research
John Royall, Head of U.S. Integrated Oils & Refining equity research
This podcast was recorded on 27 January 2023.
This communication is provided for information purposes only. Institutional clients can view the related report https://www.jpmm.com/research/content/GPS-4318088-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2023 JPMorgan Chase & Co. All rights reserved.