ICE Brent for October traded at $83.64 a barrel at 03:33 ET on Monday 3 August, down 4.88%, and NYMEX West Texas Intermediate for September traded at $79.57, down almost 6%, after President Trump said he had called off a planned strike on Iran, per CNBC1. Both are intraday quotes taken hours before the close, not settlements, and the screen will have moved before you read this. Brent is the seaborne North Sea benchmark against which most internationally traded crude is priced. WTI is the US contract delivered inland at Cushing, Oklahoma, which is why the two rarely move by the same amount on the same headline.
Monday's fall repeats a trade this desk logged eight days earlier. Brent surrendered $100 and fell 7.4% intraday on 26 July on the first reports of a US-Iran strike pause, a week after its first close above $100 since May. A second leg down on the same class of headline is a rehash of that session, not a new shock, and the paper spread moved with it: Brent-WTI stood at $5.13 on 15 July, and Monday's quotes imply roughly $4.07, a snapshot rather than a settlement-based spread.
What did not repeat sits on the product side of the barrel. Argus Media assessed the West Mediterranean diesel crack four days earlier at an all-time high, well clear of the previous peak set three weeks earlier, in the same window the flat price gave back its premium2. A refining or product desk that hedged its landed cost against outright crude is now watching that hedge come off while the cost it was hedging prints a record. The gap between the two prices, rather than the selloff on its own, is what a European trading book has to reprice this morning.
