On the 21st October, our new Chief Economist, David Wech, and Lead Analyst, Jay Maroo, discussed the latest market insights derived from oil & gas flows.

As oil and gas markets continue to strive to regain stability in a near post-pandemic world, where does Europe stand in the global recovery race? With tightening crude markets, supply issues driving energy prices higher and a likely recovery on the demand side, there are many vital questions to answer in this age of turbulence.

Core takeaways from the session:

• Fundamentals point to a substantial tightening of crude and product markets from here onwards
• An increase of requirements by up to 5mbd vs delivered supply over Q3 is possible in the coming months
• The unsustainability of Q3 stock draws, seasonal peak demand, the continued recovery from Covid, and additional power generation requirements are the key drivers
• Our flow data see increased exports materialising in crude, LNG, and transportation fuels, as the first reaction to pricing signals
• But the competition between East and West of Suez markets is heating up, with more Asian countries relaxing Covid measures
• To meet peak product demand still higher margins may be required to lure sufficient refiners back into the market and/or to maximise operation rates while coping with soaring energy costs.