BlackMask Breaking News

Despite missile and drone attacks on container ships in the Red Sea from the Yemeni Houthis, tanker traffic remained stable in December, Reuters has reported, citing vessel tracking data. On a daily basis, the data showed there were 76 tankers carrying crude oil and fuels in the Red Sea. This, Reuters wrote, was just two tankers fewer than the average for November and three fewer than the average for the first eleven months of last year.

“We haven’t really seen the interruption to tanker traffic that everyone was expecting,” Lloyd’s List shipping analyst Michelle Wiese Bockmann told Reuters.

The Houthis, who control most of Yemen, launched a string of attacks on Israel-bound ships in the Red Sea in reaction to Israel’s bombing of Gaza. As a result, container shippers have diverted traffic to the Cape of Good Hope, which adds more than a week to the average journey from Asia to Europe and has sent freight rates skyrocketing. Some oil traders, notably BP and Equinor, have also diverted some tankers from the Bab-el Mandeb Strait and the Suez Canal to the Cape of Good Hope. These developments have boosted U.S. crude oil shipments to Europe as buyers consider U.S. oil safer and cheaper in the current circumstances. Initially, the Houthi attacks on ships in the Red Sea caused a spike in oil prices but it did not last, with prices retreating to around $70-$76 per barrel. However, a more serious disruption in the flow of oil from the Middle East could change this, Goldman Sachs said earlier this week. “The Red Sea is a transit route, and a prolonged disruption there, oil can be three or four dollars higher,” the head f the bank’s oil research unit, Daan Struyven, told CNBC.“However if you have a disruption in the Strait of Hormuz for a month, [oil] prices would rise by 20 percent and could even eventually double if the disruption there lasted for longer.”

Crude oil inventories in the United States fell this week by 5.215 million barrels for the week ending January 5, according to The American Petroleum Institute (API), after analysts predicted a draw of 1.2 million barrels. The API reported a 7.418-million-barrel draw in crude inventories in the week prior. On Tuesday, the Department of Energy (DoE) reported that crude oil inventories in the Strategic Petroleum Reserve (SPR) rose by 0.6 million barrels. Inventories are now at 355 million barrels, with total purchases for the SPR totaling about 8 million barrels since the Biden Administration began its buyback program. Oil prices were trading up ahead of API data release. At 3:46 pm ET, Brent crude was trading up 1.71% at $77.42—a decrease of just over $1 per barrel compared to where it was this same time last week. The U.S. benchmark WTI was trading up on the day by 1.84%, at $72.07–a decrease of roughly $1 per barrel compared to this time last week.  Gasoline inventories saw another large build this week, rising by 4.896 million barrels, after rising by 6.913-million barrels in the week prior. As of last week, gasoline inventories are now slightly above five-year average for this time of year, according to EIA data.  Distillate inventories also rose this week, by 6.873 million barrels, after rising by 6.686 million barrels in the week prior. Distillates are roughly 6% below the five-year average.  Cushing inventories fell by 625,000 barrels, after rising by 765,000 barrels in the previous week. NN: its  very simple whats going on in two words…MILD WINTER. We are waiting for two things. Winter to kick in or the normal demand increase this spring. And the Hootie Fruties terrorists gone wild attacking every ship in sight.

Hedge funds and other portfolio managers ended the last week of 2023 with the most new bearish positions in futures and options contracts since March and the second-largest jump in weekly short additions since 2017. Money managers added some 61,000 short positions in Brent Crude and WTI Crude combined in the week to January 2, per data from the exchanges handling the trades. The latest Commitment of Traders reports show that speculators reduced their net long position – the difference between bullish and bearish bets – in ICE Brent over week to January 2 by 29,532 lots to 169,843 lots as of last Tuesday. “This move was predominantly driven by fresh shorts entering the market, with the gross short increasing by 28,578 lots over the week,” ING strategists Warren Patterson and Ewa Manthey wrote in a note on Monday. The net long in NYMEX WTI was also reduced, by 35,869 lots over the period to 89,330 lots as of January 2. This reduction was also predominantly driven by fresh shorts entering the market, ING’s analysts added. Last week, the Bloomberg Commodity index which tracks 24 major futures markets, fell by 1.8% on the week, driven by losses across all sectors, but most notably energy and grains. The biggest losses per commodity type were seen in crude oil and palladium, Ole Hansen, Head of Commodity Strategy at Saxo Bank, said, commenting on the traders’ positioning. Funds sold 65,000 lots of crude oil with the combined net long in Brent and WTI falling by 20% to 259,000 lots. The slashed net long was primarily driven by fresh short selling during a week in which prices slumped by more than 6%, Hansen added. At the start of this week, oil prices were down by 3% early on Monday after Saudi Arabia signaled softer demand by cutting the February prices for its oil to all regions. Additional downward pressure on oil could come this week from the annual rebalancing of the two biggest commodity indexes – the Bloomberg Commodity Index and the S&P GSCI – which is expected to prompt crude futures selling by funds tracking the indexes, according to Bloomberg. NN; When all the sellers have sold all that is left are the buyers

Tensions are escalating on the Israeli border with Lebanon after an Israeli strike on Monday that resulted in the death of a senior Hezbollah commander and another Hezbollah fighter in southern Lebanon.  Monday’s attack follows the assassination in Lebanon last week of deputy Hamas leader Saleh Al Arouri in another Israeli strike.  Unnamed sources confirmed for Reuters that Israel was behind Monday’s attack, which killed the deputy leader of Hezbollah’s elite Radwan force, Wissam Al Tawil. The Israeli strike targeted the car Al Tawil was driving in along with another Hezbollah fighter.  A source told Reuters that Monday’s assassination would see the situation “flare up now”, suggesting the Israel-Gaza conflict may have definitively moved into Lebanon.  Israeli Prime Minister Benjamin Netanyahu on Monday vowed to “do everything necessary to restore security to the north”, the BBC reported.  The past three months have seen dozens killed, including Hezbollah fighters, Israeli soldiers and civilians, though Hezbollah has been holding back in order to prevent an escalation into all-out war with Israel.  Observers are now concerned that two key assassinations in a row, and most significantly, Monday’s attack on a prominent Hezbollah figure could push the Iran-backed group over the edge. Oil prices on Monday did not respond to these dangerous developments on the Israel-Lebanon front, instead shedding over 4% on Monday afternoon in response to demand concerns triggered by Saudi Arabia’s move to cut the official selling prices (OSPs) for its crude loading in February to all regions. Cuts for Asian importers were the biggest, at $2 per barrel for all Saudi export grades, making the biggest cut in 13 months. Last week’s oil inventory build in the United States as well as a survey showing increased OPEC production in December have also put downward pressure on oil prices.

Shipping giant Maersk said Friday that it would divert all vessels around Africa instead of using the Red Sea and Suez Canal for the “foreseeable future” after Yemeni rebels attacked its merchant ships. The Danish company cited the highly volatile situation and noted that the security risk remains high.

“We have therefore decided that all Maersk vessels due to transit the Red Sea/Gulf of Aden will be diverted south around the Cape of Good Hope for the foreseeable future,” it said in a statement.

On Tuesday, the shipping giant said it would not resume passage on the route “until further notice” after putting it on hold over following an attack on the Singapore-flagged Maersk Hangzhou.

On Sunday, the Denmark-owned and operated container vessel, which was travelling from Singapore to Port Suez in Egypt, reported being struck by a missile while transiting the Bab al-Mandab Strait. It was then attacked by four ships operated by Yemen’s Iran-backed Huthi rebels, which “engaged fire in an expected attempt to board the vessel”, the Danish shipping company said. The US military said navy helicopters sank three of the ships while the fourth fled. Since November 18, 25 commercial vessels operating in the southern Red Sea and Gulf of Aden have been attacked. On Wednesday, 12 nations — led by the United States — jointly urged Yemen’s Huthi rebels for an “immediate end of these illegal attacks and release of unlawfully detained vessels and crews,” while warning of “consequences”. With 12 percent of world trade passing through it, according to the International Chamber of Shipping (ICS), the Red Sea is a “crucial waterway” linking the Mediterranean to the Indian Ocean, and hence Europe to Asia. Some 20,000 ships pass through the Suez Canal every year, the gateway for ships entering and leaving the zone. This is the second time that Maersk has suspended shipping through the strait. In mid-December, like other global shipping giants, the Danish company halted passage of its ships through the route, following attacks by the Huthi rebels in Yemen. It announced it would resume shipping on December 24, only to suspend traffic again on December 31, one week later.  The Huthis have repeatedly targeted vessels in the vital Red Sea shipping lane. They say the strikes are in solidarity with Palestinians in war-ravaged Gaza, which Israel has bombarded relentlessly for three months, in what it says is a campaign to destroy militant group Hamas

he United States and 12 allies issued a final warning  (ha ha ha) on Wednesday, asking them to cease their attacks on vessels in the Red Sea or face targeted military action, as reported by news agency AP. The Houthi rebels have carried out at least 23 attacks in response to the Israel-Hamas war in Gaza since December 19. According to AP, a senior official of the Joe Biden administration declined to give details pertaining to the rules of possible engagement in case the attacks continue. The official, however, highlighted that the Iranian-backed Houthis should “not anticipate another warning” from the U.S. and its allies. The official, who spoke to AP on the condition of anonymity under ground rules set by the White House, spoke soon after the countries issued a joint statement earlier on Wednesday condemning the attacks and underscoring that international patience was strained. The joint statement was signed by the United States, Australia, Bahrain, Belgium, Canada, Denmark, Germany, Italy, Japan, the Netherlands, New Zealand, Singapore, and the United Kingdom. Separately, the U.S. called on the United Nations Security Council on Wednesday to take action against the Houthis, as reported by AP. In the statement, the countries also warned Iran that it has a choice to make about continuing to provide support to the rebels. “Let our message now be clear: we call for the immediate end of these illegal attacks and the release of unlawfully detained vessels and crews,” the countries said, as quoted by AP.

“The Houthis will bear the responsibility of the consequences should they continue to threaten lives, the global economy, and the free flow of commerce in the region’s critical waterways,” they further stated.

For weeks, the Houthis have claimed attacks on ships in the Red Sea that they say are either linked to Israel or heading to Israeli ports.  The attacks by rebels aimed to end the Israeli air-and-ground offensive in the Gaza Strip that was triggered by the Palestinian militant group Hamas’ October 7 attack in southern Israel. However, the links to the ships targeted in the Houthis  assaults have grown more tenuous as the attacks continue. NN: For some reason this final warning from the toothless tigers is not working. It will take a serious escalation to stop the increasing stranglehold of one of worlds most important shipping lanes for cargo and OIL