Daily Brief Macro: Global Commodities: Oil glut paves way for stronger sanctions. If enforced and more

• US sanctions now target all four of Russia’s largest oil companies, affecting 70% of production and exports
• EU also imposes new sanctions on Russia’s energy revenues
• Russia shifts to alternative currencies for oil trade to evade US dollar restrictions, leading to higher transaction costs and reputational risks

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• Active Global funds averaged +15.5% YTD, trailing the SPDR ACWI ETF’s +18.8%, with 73% underperforming the benchmark.
• Value strategies led performance; Aggressive Growth funds lagged sharply, averaging just +10.15%.
• Underweights in US Tech names like NVIDIA and Palantir, plus 2.4% cash holdings, drove relative losses.

• Crude oil futures were moving sideways Monday amid uncertainty around trade talks and enforcement of Russian sanctions.
• Front-month Dec25 ICE Brent futures were trading at 65.67/b (1950 BST) versus Friday’s settle of $65.94/b, while Dec25 NYMEX WTI was at $61.34/b against a previous close of $61.50/b.
• Benchmarks had opened Monday higher before giving up ground that was recovered to leave the market flat from Friday.

• US base oils demand likely to stay muted amid expectations of waning end-user consumption and improving supply in coming weeks.
• US base oils demand typically falls in month of November from October.
• Prospect of slowdown in demand would coincide with rise in supply following expected completion of plant-maintenance in H1 Nov 2025.

• Asia’s Group II base oils cargo prices hold firm versus US export prices so far in Q4 2025.
• Firm prices complicate arbitrage to move surplus supplies to markets like Latin America, suggesting Asia’s supply-demand fundamentals remain balanced to tight.
• Asia’s Group II base oils price-premium to Singapore gasoil price stays at similar levels so far in Q4 2025 to end-Q3, even after recent rebound in crude/gasoil prices.

• US Group II base oils prices hold firm vs VGO prices.
• Firm base oils margins sustain incentive for refiners to maintain high output.
• Supply set to get further boost following expected completion of plant-maintenance in H1 Nov 2025.

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