Internal Market Brief
Crude & Curve
WTISupply & Inventories
EIA wk to Jul 31Week of August 3–7, 2026 (commentary dated August 10). Prices in USD/bbl unless noted; deltas are week-on-week against the prior Friday’s settle or strip. Two notes on basis. The commentary quotes WTI −$1.92 on the week because it measures from Monday’s $80.10 open; the −$6.49 above runs from the prior Friday’s $84.67 settle, and the difference is the weekend gap. And August 3 was Heritage Day — there is no Monday strip file, so every Canadian differential and gas series here runs Fri Jul 31, then Tue Aug 4 through Fri Aug 7, with Mon Aug 10 carried as an update column.
Section 01 · Crude Oil
A Full Round Trip in Risk Premium — and the Whole Move Sits in the Front of the Curve
WTI settled at $78.18 USD/bbl Friday after trading an $8.10 range around a $74.23 Wednesday low. Against the prior Friday’s $84.67 settle that is −$6.49 (−7.7%); the commentary quotes −$1.92 because it measures from Monday’s $80.10 open, after the weekend had already done most of the damage. Then Monday took the entire week back at $82.13.
Monday
WTI settled Monday at $82.13, up $3.95 (+5.1%), and Brent at $87.72 — a fourth consecutive higher session — after Iran struck another tanker off the coast of Oman in the US-backed southern corridor over the weekend and the Houthis claimed an attack on Saudi Arabia’s Jizan refinery. Worth noting for anyone reading the commentary literally: it quotes the prompt at $79.38 at 5:18 this morning, so the entire $2.75 above that came during Monday’s session. Tehran’s position hardened with the price: the Foreign Ministry said the US blockade must lift before Iran will agree to open Hormuz, and that any Oman arrangement will not produce an immediate reopening.
- Settled $78.18 Fri, −$6.49 (−7.7%) vs the prior Friday’s $84.67 — −$1.92 on the commentary’s open-to-settle basis.
- Mon — −$4.33 to $80.34, the weekend repricing after planned US strikes on Iranian energy infrastructure were called off.
- Tue — −$4.57 to $75.77 as OPEC+ returned quotas to pre-2023 levels; the September Canadian cycle opened the same morning.
- Wed — $74.23 low print on a Treasury Secretary comment that a strait deal was a day away, plus the Iran–Oman route agreement.
- Thu +$2.07 / Fri +$0.89 — the terms of that route (US and Israeli ships barred, 20%-of-cargo penalties) plus Iranian strikes near the strait entrance.
- Mon Aug 10: $82.13, +$3.95 — the whole week reversed in one session on a weekend tanker strike.
The Curve: All of It Is in the Front
- Aug-26 −$5.92, Dec-27 −$0.61. The Aug-26/Dec-27 spread flattened from $15.00 to $9.69 in four sessions.
- Bal-26 CMA average $78.50 → $75.48; Cal-27 $70.60 → $69.75 (Jul 31 vs Aug 7 strip dates).
- The curve never left backwardation — it just got shallower. A two-to-four-month route agreement is a front-month event, and the curve priced it as one.
- Monday undid the front: Bal-26 back to $79.15, Cal-27 to $72.23 — the back end is now higher than the Jul 31 strip.
- For Canadian heavies the time-spread effect eased with the flattening, which is part of why WCS held a $0.20 band all week.
Domestic: an Unexpected Crude Build Against Products That Keep Draining
- Crude +2.5 MMb to 407.0 MMb against a −1.5 MMb consensus — but still 22.8 MMb below the five-year average and under the five-year lower bound.
- The build is mechanical: imports +515 kb/d to 6.2 MMb/d (Canadian barrels the highest since April) and runs −183 kb/d to 96.5% utilization.
- Cushing +2.4 MMb to 20.96 MMb — back over the ~20 MMb operational minimum after a twelve-year low. Worth flagging: the tank-bottoms narrative just lost a week.
- Crude incl. SPR at 711.8 MMb, lowest since 1983. Combined cover keeps shrinking even as the commercial number bounces.
- Distillate −3.5 MMb to 107.2 MMb against a build consensus — 9.7 MMb (8.3%) under its own five-year average on the dashboard series, and the lowest seasonal level since 1996 on the commentary’s basis. Gasoline −1.6 MMb to 209.7 MMb, 14.5 MMb under its five-year average.
- Diesel exports hit an all-time high 1.9 MMb/d with production falling — refiners cannot lift diesel yield further at these run rates ahead of August–October maintenance.
Desk angles
view
Bias: neutral-to-lower flat price on any credible route agreement, constructive distillate cracks regardless. The market has now failed to hold a de-escalation trade three weeks running, and it has failed to hold a war bid just as often — there is no directional edge in flat price at these levels. Levels: $84.67 prior Fri · $74.23 low print Wed · $78.18 Fri · $82.13 Mon Aug 10. Producers: the September cycle opened at the low and has firmed every session since — anyone who priced September on Aug 4 has left $2 to $5 on the table depending on grade. Call SYN-weighted shippers first. Watch: whether the Oman text drops the 20%-of-cargo penalty and the US/Israel ship ban, the ADNOC strike count, Wednesday’s EIA print for whether the import spike persists, and the front of the CMA curve rather than the flat price.
| Scenario | Trigger | WTI path |
|---|---|---|
| Bear / route signed clean | Joint statement drops the ship ban and cargo-value penalty; US lifts the naval blockade | $68–74, and the front of the curve leads it down |
| Base / route signed dirty | Two-to-four-month corridor through Iranian waters, conditions attached, blockade stays | $76–84, headline chop with a firm floor |
| Bull / talks collapse | Tanker strikes continue past the ADNOC 16; a Saudi facility or Ras Laffan is confirmed hit | $90+ and the back end finally moves |
Storylines
Section 02 · Western Canada
September Opens at the Low and Firms Every Session — SYN Adds $5.20 in Four Days
The mid-to-end-week rally in WTI drove most of the differential tightening. The September cycle opened Tuesday — the same session WTI fell $4.57 — and then tightened in every subsequent session, with condensates and sweets doing the work while heavy sours softened modestly and medium sour activity stayed sparse. SYN is the standout: our September strip went from +$8.80 at the open to +$14.00 Friday, and +$17.30 by Monday.
- August was thin but constructive: C5-PCE NAM −$1.80 → −$0.50, C5-FSPL −$1.00 → +$1.00, C5-CRW −$1.80 → +$0.50.
- Sweets: PCE the only active grade, +$2.50 → +$3.80.
- SYN +$7.30 → +$8.80 → +$11.50 in the August contract — against a locked +$2.08 August index.
- For reference the August spot marks in the price file are WCS −$15.50, C5 +$0.50, MSW +$3.75 against indices of −$14.23, −$3.09 and −$3.08.
The September Cycle, Session by Session
- Every grade traced the same shape: open Tuesday, low Wednesday alongside WTI’s $74.23 print, then firm into Friday.
- Condensates: C5-PCE NAM −$1.20 → −$1.70 → −$0.60; C5-FSPL → +$0.70; C5-CRW → +$0.30.
- Sweets in lockstep: PCE +$1.40 → +$3.40, PEM → +$3.50.
- Medium sour thin but better: CAL −$1.50 → −$0.80, PSO −$1.20 → −$0.40; LSB ~−$3.30 and MID ~−$6.50 unchanged.
- Heavies in a $0.70 band: WCS −$14.40 → −$15.10 → −$14.80; CHV −$14.40 → −$15.40 → −$15.10 (last print Thursday).
of the week
SYN. Our September strip ran +$8.80 → +$9.80 → +$12.00 → +$14.00 across four sessions and printed +$17.30 on Monday — +$8.50 from the Aug 4 open, against a locked August index of +$2.08. The driver is supply, not WTI: several upgrader outages run through September, and Suncor’s Mildred Lake turnaround had its start date pulled forward by eight days to August 20 and was extended by two — a net ten-day extension. We flagged stronger SYN for September in previous commentaries; what was not in the plan was the magnitude. Anyone who priced September SYN on the Tuesday open is now $5 to $8 behind the market.
Heavies: Why WCS Did Not Follow
- WCS −$14.25 → −$14.70 on our September strip, a $0.20 band from the Tuesday open; Hardisty spot at −$14.80 Tuesday vs −$14.25 the prior Friday.
- Pressures: local refinery turnarounds, weak Chinese heavy demand, and Venezuelan barrels at ~600 Mb/d on the USGC displacing the Saudi shortfall.
- Partial offset: the time-spread drag eased as WTI backwardation flattened from $15.00 to $9.69 across Aug-26/Dec-27.
- Monday reversed a touch to −$15.00 — heavies do not get the benefit of a WTI rally the way sweets do.
| Grade | Aug index | Sep · Jul 31 | Sep · Aug 4 open | Sep · Aug 7 | Δ cycle | Sep · Aug 10 |
|---|