In today’s briefing:
- US/China: Sprint vs Stamina
- Steno Signals #201 – The Mullahs Are Toast – Re-Inflation Is Back!
- China – Where To Invest?
- Global base oils margins outlook: Week of 16 June
- [US Nat Gas Options Weekly 2025/24] Henry Hub Slips on Tepid Demand and Subdued Export Flows
- [US Crude Oil Options Weekly 2025/24] WTI Surged on Mideast Tensions and U.S.-China Trade Optimism
- CX Daily: Chinese Biotech Is Having a ‘DeepSeek Moment’
- Global base oils arb outlook: Week of 16 June
- Americas/EMEA base oils supply outlook: Week of 16 June
- Americas/EMEA base oils demand outlook: Week of 16 June
US/China: Sprint vs Stamina
- The recent US/China trade talks highlighted Beijing’s superior leverage and determination.
- Beijing is in a stronger position in terms of both leverage and willingness to persist.
- Avoiding a re-escalation after the current 90-day truce relies on Washington making more concessions.
Steno Signals #201 – The Mullahs Are Toast – Re-Inflation Is Back!
- Happy Monday from Copenhagen.
- What a comeback by JJ Spaun at Oakmont yesterday (sorry to the non-golfers), and what a comeback risk is about to make this week.
- Iran’s mullah-tocracy is on the brink, and it could be a catalyst for a big bounce in risk appetite.
China – Where To Invest?
- Overweight AI, high tech, robotics, renewables and bio-tech. Underweight on consumer discretionary, property and export cyclicals.
- China has become even more vital to its green transition. At the same time the shift in government mindset means that domestic innovation is advancing at a breathtaking pace.
- That said the economy is yet bottom. The profit cycle downturn is worsening; As of April 30% of manufacturing companies were loss making, up from 25% in November
Global base oils margins outlook: Week of 16 June
- Global base oils margins fall as feedstock/competing fuel prices surge.
- Sharp fall in base oils margins reflect impact of higher crude/diesel prices rather than any sudden change in base oils supply-demand fundamentals.
- Fall in base oils margins comes at a time of year when supply-demand fundamentals are already starting to face downward pressure.
[US Nat Gas Options Weekly 2025/24] Henry Hub Slips on Tepid Demand and Subdued Export Flows
- For the week ending 13/Jun, U.S. natural gas prices fell by 5.4% on the back of mild near-term demand, softening LNG exports, and rising storage levels.
- For the week ending 06/Jun, the EIA reported that U.S. natural gas inventories rose by 109 Bcf, higher than analyst expectations of a 108 Bcf build.
- Henry Hub OI PCR inched up by 0.86 on 13/Jun compared to 0.85 on 06/Jun. Call OI increased by 4.3% WoW, while put OI grew by 5.5%.
[US Crude Oil Options Weekly 2025/24] WTI Surged on Mideast Tensions and U.S.-China Trade Optimism
- WTI futures surged by 13% for the week ending 13/Jun on the back of rising geopolitical tensions in the Middle East and easing trade tensions between the U.S. and China.
- The U.S. rig count fell by four to 555. The oil rig count fell by three to 439, while gas rigs inched down by one to 113.
- WTI OI PCR grew to 0.89 on 13/Jun compared to 0.83 on 06/Jun. Call OI rose by 5.9% WoW, while put OI grew by 14.5%.
CX Daily: Chinese Biotech Is Having a ‘DeepSeek Moment’
- Drugs / Cover Story: Chinese biotech is having a ‘deepseek moment’
- Hong Kong /: Hong Kong bets on stablecoins and AI to future-proof its financial edge
- Home appliances /Analysis: New U.S. tariffs mean tough times ahead for appliance-makers
Global base oils arb outlook: Week of 16 June
- US Group III 4cSt base oils price rises in June to highest level in almost nine months.
- US Group III 4cSt price rises relative to Group II base oils, relative to feedstock prices and relative to other regions.
- US Group III price-strength coincides with tighter global Group III supply-demand fundamentals and growing number of signals reflecting those tighter fundamentals.
Americas/EMEA base oils supply outlook: Week of 16 June
- US base oils margins fall as crude and heating oil prices surge.
- Margins had previously been trending lower slowly.
- Steady-to-lower margins coincided with muted domestic demand and improving supply fundamentals following completion of most plant maintenance work.
Americas/EMEA base oils demand outlook: Week of 16 June
- US base oils demand could get support from expectations of steady-to-higher prices following surge in crude oil prices.
- Weakening supply-demand fundamentals previously put pressure on adjustment in base oils prices to reflect that dynamic.
- Concern about exposure to lower prices incentivized buyers to limit their procurement plans.
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