---

Commentary

WTI lost 16 cents, or 0.2 percent, to $66.88 a barrel by 04:23 GMT, after falling almost 2 percent yesterday, and Brent crude, which was little changed in the previous session, was down 9 cents, or 0.1 percent, to $77.47 per barrel. Well, as one world problem seems to have been solved, another comes to the fore. Italy has finally put together a government, and I use the word government in the loosest sense. However, Trump has throw another spanner into the workings of the world with steel tariffs, which has really miffed the usual U.S. allies of the EU, Canada, and Mexico. It seems that the President has been influenced by the phrase 'Treat 'em mean, keep 'em keen'. The news story of the market is the WTI-Brent spread, which is now so wide you could drive a VLCC through it, moving to $11 - the widest since 2015. Although the U.S. production keeps climbing, a cause for concern is the region's ability to transport this production to export positions. Pipeline capacity is full and production increases are far outstripping attempts to increase this capacity.

Economic data/events (Times are London.)

* 1:30pm: U.S. Change in Nonfarm Payrolls, May

* 1:30pm: U.S. Unemployment Rate, May

* 2:45pm: U.S. Markit Manufacturing PMI, May

* 3pm: U.S. Construction Spending, April

* 3pm: U.S. ISM Manufacturing, May

* 6pm: Baker Hughes rig count

* ~6:30pm: ICE weekly commitments of traders report for Brent, gasoil

* 830pm: CFTC weekly commitments of traders report on various U.S. futures and options contracts

Singapore 380 cSt

Jul18 - 437.75 / 439.75

Aug18 - 434.00 / 436.00

Sep18 - 430.25 / 432.25

Oct18 - 426.50 / 428.50

Nov18 - 422.75 / 424.75

Dec18 - 419.25 / 421.25

Q3-18 - 434.00 / 436.00

Q4-18 - 423.00 / 425.00

Q1-19 - 411.00 / 413.50

Q2-19 - 397.50 / 400.00

CAL19 - 375.25 / 378.25

CAL20 - 302.75 / 307.75

Singapore 180 cSt

Jul18 - 448.75 / 450.75

Aug18 - 445.00 / 447.00

Sep18 - 441.00 / 443.00

Oct18 - 437.25 / 439.25

Nov18 - 433.75 / 435.75

Dec18 - 430.50 / 432.50

Q3-18 - 445.00 / 447.00

Q4-18 - 434.00 / 436.00

Q1-19 - 422.25 / 424.75

Q2-19 - 409.25 / 411.75

CAL19 - 389.50 / 392.50

CAL20 - 316.50 / 321.50

Rotterdam 3.5%

Jul18 - 421.75 / 423.75

Aug18 - 418.25 / 420.25

Sep18 - 414.25 / 416.25

Oct18 - 409.75 / 411.75

Nov18 - 405.25 / 407.25

Dec18 - 400.75 / 402.75

Q3-18 - 418.00 / 420.00

Q4-18 - 405.00 / 407.00

Q1-19 - 393.00 / 395.50

Q2-19 - 378.75 / 381.25

CAL19 - 354.00 / 357.00

CAL20 - 283.00 / 288.00