Weekend – TotalEnergies CEO says Gulf producers discounting crude to clear stockpiles
Pouyanné's comments point to an unusual bifurcation in the oil complex, with crude prices collapsing on a stockpile overhang even as refined product markets stay tight and priced well above what current Brent levels would imply. That gap creates an opportunity in refining margins for companies with spare processing capacity, while continuing to squeeze fuel-dependent sectors that are not seeing the benefit of cheaper crude passed through to the pump. The three to four month rebalancing timeline he cites suggests the dislocation is not expected to resolve quickly, keeping crack spreads elevated and adding another data point for traders trying to reconcile falling crude benchmarks with stickier downstream costs.
TotalEnergies CEO Patrick Pouyanne said Middle East producers are heavily discounting crude to clear stockpiles, while gasoline and diesel stay tight on shipping fears, with the market needing three to four months to rebalance.
Info via Bloomberg (gated)
Summary:
- TotalEnergies CEO Patrick Pouyanné said Middle Eastern producers have built up such large crude inventories during the conflict that they are now desperate to sell
- Gasoline and diesel are still trading at levels consistent with crude oil priced at $95 to $100 a barrel, even as Brent trades around $72
- Pouyanné said shipowners remain reluctant to send tankers through the Strait of Hormuz, keeping refined product supply constrained despite the crude glut
- He said producers are heavily discounting their crude as a result, contributing to the recent collapse in oil prices
- Pouyanné estimated it will take three to four months for the market to rebalance
- He described the aftermath of the blockade as complex, producing some unexpected and striking developments in the market
TotalEnergies Chief Executive Patrick Pouyanné said Middle Eastern oil producers are desperate to sell crude they stockpiled during the recent Persian Gulf conflict, even as gasoline and diesel markets remain constrained by lingering shipping concerns through the Strait of Hormuz.
Speaking at the Rencontres Economiques conference in Aix-en-Provence, Pouyanné said producers in the region built up such large inventories during the conflict that they are now offering heavy discounts to move the oil, a dynamic he linked directly to the recent collapse in crude prices. Brent traded around $72 a barrel on Friday, well below the levels implied by refined product pricing. Gasoline and diesel, he said, are still trading as though crude oil were priced at $95 to $100 a barrel, reflecting a persistent gap between the crude and downstream markets.
Pouyanné attributed the disconnect to continued caution among shipowners, many of whom remain unwilling to send tankers through the Strait of Hormuz despite the broader de-escalation following the conflict. That reluctance has kept refined product supply tight even as crude supply balloons, producing what he described as a complex and at times unexpected set of market dynamics in the aftermath of the disruption. He estimated it would take three to four months for the market to fully rebalance as shipping patterns normalise and the backlog of stockpiled crude works its way through the system.
The comments add texture to a broader post-conflict adjustment already visible in supply data, from OPEC+'s continued output increases to gradually recovering Hormuz traffic volumes. Pouyanné's remarks suggest that even as headline crude prices ease back toward pre-war levels, the benefits are not yet flowing through evenly to refined fuel markets, a gap that could keep pump prices elevated relative to crude for consumers in the near term. His comments also point to a wider structural question facing the industry: how quickly shipping risk perceptions around the strait will normalise, and how that timeline will shape the pace at which crude and product markets converge again.
This article was written by Eamonn Sheridan at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
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