Brent tops $105 and WTI jumps 5% as Hormuz attacks and a Gulf storm cut into supply
Brent crude is back above $105 a barrel, up 4.81% from Wednesday's close, and WTI is at $92.69, up 5%, after Iran stepped up attacks on tankers in the Strait of Hormuz and US Gulf Coast operators began shutting in production and prepping refineries ahead of an approaching storm. Two supply scares landed on the same day. One is a shipping chokepoint for crude; the other is a direct hit to US refining runs.
Gulf Coast shut-ins
The storm matters more to your wholesale rack than the crude headline does. When Gulf refiners cut runs and take units down to ride out weather, the shortfall shows up fast in gasoline and diesel differentials, not just in the flat price of a barrel. Crude can climb while the thing you actually buy climbs faster, and that widens the crack spread refiners earn on every gallon they do make. Jobbers pricing freight for next week should watch product basis, not WTI.
Salavat refinery fire
Ukraine struck the Gazprom Neftekhim Salavat complex in Bashkortostan on October 8, roughly 1,400 km from the border, and a fire broke out at the plant. It can process up to 10 million tonnes of feedstock a year and makes gasoline, diesel, fuel oil and bitumen, and the General Staff says it supplies the Russian military. These strikes have followed a pattern: the crude reaction fades unless the damage is confirmed as lasting, while the product side holds the pressure, since taking out distillation and secondary units tightens diesel and gasoline. It supports the same global product squeeze the Gulf storm is feeding.
Propane draw
US propane inventories posted a larger-than-expected draw as exports rebounded and Gulf Coast stocks pulled back from last week's record high, per RBN Energy. Total inventories are still 17% above the five-year average heading into the seasonal draw. Comfortable starting cushion, but exports are pulling hard again, and that is the number to track as heating season loads up.
Ethanol exports
EIA weekly data shows ethanol production up 5%, stocks down 1%, and exports up 17%. Strong export pull with production rising and inventories slipping is a tighter blend economics setup than the raw production number suggests for anyone buying denatured product.
What to watch
Whether the Hormuz attacks disrupt actual cargoes or stay a risk premium. How long Gulf refiners stay down and how wide product cracks run while they are offline. Whether the Salavat fire knocks out units for weeks or days. Crude could ease if the strait stays open and the storm passes clean, but the product side looks tighter than the flat price alone.