May and June WTI Brent arb

Overview

Thursday saw the WTI Brent arbs have a very volatile day. In the overnight hours into Thursday, the arb widened favor of the Brent as fears were heightened regarding supply disruptions in the Mideast on the back of the Ras Laffan LNG facility attack by Iran along with other attacks on energy infrastructure in the region. The arb then rallied dramatically in favor of the WTI near noon NY time as news was seen that the US was not planning to implement a crude oil export ban. 

The arb had widened recently partly due to US crude supplies having risen as imports of Venezuelan crude have doubled to about 423 MBPD, the highest level since November 2024. The arb had also widened recently as the market was worried that "The Trump administration may decide to consider a crude-oil export levy, or possibly a ban, to combat surging energy prices caused by the war in the Middle East", according to RBC Capital Markets LLC. --trying to keep more barrels in the US. 

The May and June WTI Brent arbs are having inside trading days today--which is not at all surprising given yesterday's extremely large price ranges.

The momentum indicator for the arbs is getting oversold---thus suggesting WTI may gain on Brent.
The May arb sees its daily chart's lower bollinger band intersecting at -$12.90 and that for June intersects at -$11.41.

For the May arb we see support for the WTI versus the Brent at -$16.18 and then at -$20.69. Resistance for the WTI on the upside lies at -$11.37 and then at -$9.99.

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