Crude Oil
Oil prices continued to stay buoyant amid enthusiasm that the new year will show better economic prospects. Brent crude settled 24 cents higher at $68.16 a barrel. WTI, however, rose just 4 cents to $61.72 a barrel.
Oil prices gained for the fourth consecutive week in the wake the optimism of the US China trade deal.
U.S. stock indexes rose slightly on Friday, with the S&P 500 index close to logging its best year since 1997. The Nasdaq crossed the 9,000 point mark for the first time on Thursday.
Oil-market sentiment improved as new data showed profits at China’s industrial firms rose at the fastest pace in eight months in November, according to the National Bureau of Statistics.
In the United States, a survey showed on Thursday online holiday purchases by U.S. consumers reached a record, beating analysts’ expectations and lifting U.S. stocks to fresh highs.
U.S. energy firms idled eight working oil rigs, the first reduction in three weeks, as producers followed through on plans to slash spending.
doe data
U.S. crude stocks fell by 5.5 million barrels in the week to Dec. 20 to 441.4 million barrels, according to the DOE, far exceeding analysts’ expectations of a 1.7 million-barrel drop.
The rise in crude stocks was at odds with our material balance report which suggested that the increase in consumption was less than the increase in net import. While the increase in gasoline stocks too appeared to be more than reported, the draw in distillate stocks was more than reported.
Naphtha
Asia’s naphtha crack recovered to a two-day high of $98.15 a tonne on Friday as demand emerged after the seasonal lull.
Japan’s Asahi Kasei, which operates a 567 ktpy cracker in Mizushima, bought open-specification naphtha for second-half February delivery at premiums below $20 a tonne to Japan quotes on a cost-and-freight (C&F) basis, pegged to second-half December pricing formula. The petrochemical maker may have also bought light grade naphtha through private negotiations but no details were available.
Overall, Japan’s total naphtha imports for the first 11 months of this year at 12.14 million tonnes, are down by about 3.3% versus the same period in 2018.
The January crack is lower at – $ 3.60 / bbl.
Gasoline
No fresh news on gasoline markets.
The January crack is higher at $ 7.05 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Cash premiums for 10 ppm gasoil rose to 91 cents per barrel over Singapore quotes, up from 75 cents per barrel a day earlier.
Cash differentials for jet fuel rose to a premium of 27 cents per barrel to Singapore quotes, thanks to three firmer deals in the physical trade window on Friday. They were at a premium of 6 cents on Thursday.
The January crack for 500 ppm Gasoil is higher at $ 15.05 /bbl with the 10 ppm crack at $ 15.85 / bbl. The regrade is at -$ 0.25 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Asia’s front-month crack for 0.5% very low-sulphur fuel oil (VLSFO) rose on Friday, backed by persistent buying interests and tightening supplies. With less than five days remaining ahead of the IMO deadline to switch to cleaner marine fuels, the 0.5% VLSFO margins climbed to $27.64 a barrel to Brent during Asian trading hours on Friday, Refinitiv Eikon data showed.
The January/February VLSFO time spread narrowed to $12.25 per tonne, down from a more than three-month high of $15 per tonne hit on Thursday.
The front-month 380-cst high-sulphur fuel oil (HSFO) barge crack edged higher to a discount of minus $27.13 a barrel to Brent, up from minus $28.01 a barrel on Thursday, Refinitiv data showed.
Asia’s cash premium for 380-cst HSFO was at $13.94 per tonne to Singapore quotes, compared with $10.19 a tonne on Thursday.
The January 180 cst crack is higher at -$ 19.75 / bbl with the visco spread at $ 1.35 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
No fresh action for today.
Hedge recommendations are essentially made for refiners. These are not trading positions as such. The rationale of these positions is to lock in extraordinary levels for the refiner.
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About this blog
This blog post attempts to give a top level summary of the Singapore market goings on to a person who seeks to obtain a directional sense of the market on a daily basis.