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An anonymous tipster swears Elvis Is alive and at the same time is suggesting that OPEC is planning to raise output. After oil prices roared higher on Tuesday, climbing over 1% as the U.S. slapped sanctions on Iran’s oil revenue stream, tightening the screws on global supply, today another anonymous tipster is causing prices to pull back. Maybe it is not the same guy that said he saw Elvis, but it could be because let’s face it they go by the same name – anonymous.

Yes, the unnamed sources are back, and they are claiming that OPEC+ may consider another oil production increase at Sunday’s meeting. And you know what? They may! Then again, they may not. Yet with signs of tightening supply and more risk to supply, they would be crazy to not at least talk about it. Reuters wrote that another output boost would mean OPEC+, which pumps about half of the world’s oil, would be starting to unwind a second layer of cuts of about 1.65 million barrels per day, or 1.6% of world demand, more than a year ahead of schedule. But based on supply and demand and geopolitical risk to Russian and Iranian supply, the market is signaling it needs more oil.

Heating oil crack spreads and gasoline crack spreads surged back to the upside fueled by tight supply and signs of strong product demand, fuels by more sanctions on Iran and tariffs on India and anticipation for Sunday’s OPEC+ meeting, where analysts are betting the group will keep its voluntary production cuts in place. Platts reported that as of September 1, total oil product stocks in Fujairah were 14.506 million barrels, which is the lowest level since February 14, 2022, when stocks were at 14.266 million barrels. There was a week-on-week decrease of 1.503 million barrels. During this period, middle distillate stocks increased, while light distillate and heavy residue stocks decreased further suggesting tight supply.

Meanwhile, Saudi Aramco and Iraq’s state oil company have slammed the brakes on crude sales to India’s Nayara Energy, and they are taking seriously President Trump’s threat of secondary sanctions on their country for purchases of Russian oil and EU Sanctions. Apparently, they don’t want to get caught up with the potential backlash against India that may be coming from the Trump Administration.

On top of that, Ukraine’s relentless attacks on Russian infrastructure have forced Moscow to shutter 17% of its oil-processing capacity, according to Reuters further squeezing global supply.

The U.S. military made waves in the Caribbean, blasting a Venezuelan vessel loaded with illegal drugs. President Donald Trump, speaking from the White House, crowed, “We just, over the last few minutes, literally shot out a boat, a drug-carrying boat, a lot of drugs in that boat.” It’s the first reported strike since the Trump administration’s recent naval buildup in the region, signaling a no-nonsense approach to curbing illicit drug trade.

Regardless of OPEC’s decisions to adjust production, oil prices are struggling to drop below $60 a barrel, suggesting a floor and global inventories remain tight despite earlier forecasts of a glut by the International Energy Agency. The upcoming American Petroleum Institute report is expected to show drawdowns, which could help stabilize the market after OPEC-related volatility. Meanwhile, crack spreads indicate products continue to be in short supply.

Natural gas prices are back up and trying to bottom. Cold temperatures go from being bearish to potentially bullish as predictions of a cold winter are starting to make the rounds. Celsius Energy reports that for the natural gas storage week of August 23-29, which concludes today, a preliminary injection of +56 BCF 9 (WE have 55) is projected. This figure is 21 BCF above the five-year average and 40 BCF higher than last year, representing the second largest build for this week in the past five years. Significantly cooler temperatures led to a considerable reduction in cooling demand, although tighter supply and demand balances mitigated the overall impact.

Traders are also eyeing the Gulf of America to see if the storm threats could impact either offshore production imports or exports. Fox Weather Forecast Center reports that conditions remain conducive for Atlantic disturbance to become Tropical Depression 7.  The National Hurricane Center is now giving the system a high chance of developing over the next week. The National Hurricane Center (NHC) is continuing to monitor a tropical disturbance that emerged off the coast of Africa last weekend, and forecasters are saying it will likely become Tropical Depression Seven later this week or over the weekend. The disturbance is currently located in the eastern tropical Atlantic to the southwest of the Cabo Verde islands and is producing disorganized showers and thunderstorms, but it is moving into an area where environmental conditions remain conducive for gradual development.

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