Oil supports the very fabric of our modern society; it’s central to our connected and switched-on way of life. From car fuel to electricity to petrochemicals and plastics, Kurush Mistry understands and recognizes oil as an energy source that plays a vital role in our current energy mix.
Kurush started his professional journey towards becoming an oil expert in the aftermath of the financial crisis, transitioning his analytical skills from his earlier roles in Interest Rate Research,
Kurush Mistry’s Understanding of the Oil Industry
Kurush’s initial entry into oil analytics came in 2009 when he joined Morgan Stanley, one of the top oil trading firms at the time. During his five years with the firm, Kurush helped the organization build out their analytics capability for both the gasoline and diesel teams in the United States.
In 2014, Kurush joined Freepoint Commodities, beginning his tenure as the firm’s sole oil analyst. Throughout his nine years at Freepoint, Kurush contributed extensively to creating the company’s global oil analytics framework. He also incorporated alternative data into the analysis, especially after the COVID-19 pandemic affected oil markets. Kurush worked closely with over 25 traders during his Freepoint tenure, providing market intelligence, supply-demand forecasts, and trade ideas.
Throughout his career in oil analysis, Mistry has recommended trading strategies based on his:
- Deep understanding of the fundamentals of the oil markets
- Knowledge of refinery operations, economics and trade-offs
- Detailed modeling of global and local supply-demand for various refinery products
- Ability to identify the key drivers of asymmetric trading risks
- Experience around various event-risks and the effects they have on markets, be they operational, geopolitical or weather-related
Within the oil space, Mistry has covered products across the oil barrel, including:
- Crude Oil, especially at Cushing
- LPG
- Gasoline
- Fuel oil
- Refinery margins
In 2022, recognizing the increasing significance of renewable fuels in the energy mix, Kurush expanded his knowledge and skills to include:
- Sustainable Aviation Fuel
- Renewable Diesel
- Ethanol
- Biodiesel
- US Soybean Oil
Kurush’s Insights on Oil Analysis
Some of the major analyses that Kurush has undertaken in the course of his career are around the Fukushima disaster, IMO2020, Covid, and the Russia-Ukraine war.
In the Fukushima disaster, all of Japan’s nuclear power generating capacity was placed offline, and required significant importation of fossil fuels to replace the capacity. This had knock-on effects on the global crude and fuel markets, specifically raising the premium for heavier crudes, and raising refining margins for fuel oil.
The change of bunker fuel to lower sulfur specification in early 2020 was one of the largest regulatory changes affecting the oil markets in decades. Mistry analyzed whether enough lower-sulfur crude was available, whether the refining system would have the operational and logistical flexibility to adapt to this significant change, and whether substitutes in non-bunker use would be available.
The COVID pandemic caused a huge disruption to normal working and commuting practices, and that disruption evolved as the pandemic progressed through different stages. During this time, Mistry incorporated alternative data such as mobility and work-from-home statistics into modeling gasoline and diesel demand in the US and Europe.
Russia’s invasion of Ukraine caused a huge spike in natural gas prices and changed refinery economics in Europe, necessitating product spreads to crude to widen out significantly. In addition, the imposition of sanctions on Russian crude oil and refined products caused large changes in their global flows patterns and customers. Mistry estimated the evolving impact of these changes on refinery economics, shipping and crude oil prices.