Oil prices rose about 1 percent on Friday, as the fear of shortage of supply overshadowed concerns over a slowing global economy. The May Brent crude oil futures contract, which expired Friday, gained 57 cents to settle at $68.39 a barrel, marking a first-quarter gain of 27 percent. The more-active June contract settled up 48 cents at $67.58 a barrel. U.S. WTI) futures rose 84 cents to $60.14 a barrel, and posted a rise of 32 percent in the January-March period.
For the week, both Brent as well as WTI gained around 2% For both the benchmarks, the quarterly rise was the biggest since the second quarter of 2009, when both gained about 40 percent.
The United States has instructed oil trading houses and refiners to further cut dealings with Venezuela or face sanctions themselves, even if the trades are not prohibited by published U.S. sanctions.
Some cracks appear to be emerging in the pact in the OPEC+ group. OPEC leader Saudi Arabia is struggling to convince Russia to stay much longer in the pact whereas Moscow may agree only to a three-month extension.
Futures have been pressured by concerns that a slowing global economy could hit energy demand. U.S. consumer spending rebounded less than expected in January and incomes rose modestly in February. Elsewhere, three of China’s top state-controlled bank posted their weakest quarterly profit growth in more than two years.
Hedge funds and other money managers raised their net long U.S. crude futures and options positions to 243,209 in the week to March 26, the U.S. Commodity Futures Trading Commission (CFTC) said.
Baker Hughes has reported a sixth consecutive drop of active rigs. This week, the number of rigs dropped by 6 to 816. This is the lowest number since April last year. The drop in active rigs is the maximum drop seen in a quarter for the last 3 years.
U.S. President Donald Trump on Friday signed a new permission for TransCanada Corp to build the long-delayed Keystone pipeline for imports of Canadian oil, replacing his previous permits in a fresh attempt to get around the blocking of the $8 billion project by a court in Montana
Asia’s naphtha inter-month premium stayed at $8 a tonne for the sixth straight session, but spot trades were mostly muted following two deals from South Korea in the previous session.
The April crack is marginally higher at -$ 5.50 /bbl
Asia’s gasoline crack recovered to a two-session high of $6.58 a barrel after falling to a 1-1/2 week low in the previous session.
Gasoline fundamentals remained firm with inventories being drawn down across Singapore, the United States and Europe. Gasoline stocks in ARA eased 37 KT to reach a nearly three-month low of 1.03 million tonnes in the week to Thursday. Some of the shipments are headed for Singapore.
The April crack is higher at $ 7.30 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Cash discounts for 10ppm gasoil widened by a cent to 21 cents a barrel to Singapore quotes on Friday.
Cash discounts for jet fuel, however, narrowed to 20 cents a barrel to Singapore quotes, as against a 35-cent discount on Thursday.
The ongoing maintenance at some refineries in the region have not tightened overall supplies substantially yet.
ARA onshore inventories of gasoil rose by 150 KT to a 5 month high of 2.69 million tonnes in the week to March 28.
The April crack for 500 ppm Gasoil is lower at $ 12.25 /bbl with the 10 ppm crack at 13.20 / bbl. The regrade is lower at +$ 0.25 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
The cash discount for cargoes of Asia’s 380-cst high-sulphur fuel oil (HSFO) widened on Friday, nearing a one-year low hit last week, while premiums of 380-cst front-month time spreads were also at their narrowest in almost a year.
The 380-cst cash differentials dived to minus 27 cents a tonne to Singapore quotes, compared with minus 15 cents per tonne in the previous session. Singapore cargoes of 380-cst HSFO hit a near one-year low of minus 44 cents per tonne last Friday.
The April/May 380-cst time spread was at 50 cents per tonne on Friday, down from $1.25 a tonne in the previous session and its lowest since April 18.
ARA fuel oil inventories rose by 61 KT to 836 KT.
The April 180 cst crack is steady at $ 0.00 / bbl with the visco spread at $ 1.00 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Nothing fresh to consider today.
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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.