After trading lower for most of the day, oil prices rallied in the last hour of trading to finish higher for the 6th day in a row. While Brent rose by 13 cents to settle at $52.65 /bbl , WTI increased by 46 cents to end at $50.17 /bbl. This is the first time WTI has settled over $ 50/bbl since May 29.
The market was boosted in part by anticipation of sanctions against Venezuela even as fears of a supply overhang have receded after two strong stock draws in a row in the US. Today’s API report would hopefully confirm the shortage of supply as compared to demand.
A fire at Royal Dutch Shell’s 404,000 barrels per day (bpd) Pernis refinery in the Netherlands has propped up naphtha and gasoline cracks. With Europe’s largest refinery suspending loadings of oil products for an indefinite period, fears of supply shortages will boost margins until there there is clarity on refinery restart.
The August crack is higher at $1.05/bbl.
Gasoline cracks have strengthened on the back of supply worries in Europe caused by the fire at the Pernis refinery as well as strong demand coming out of Iran.
The August crack is valued at $ 12.25 /bbl. today.
Although valued slightly lower today, Gasoil cracks are expected to rise as traders predict more cargoes from Asia and the Middle East being shipped into Europe to make up for the supply shortfall caused by the unexpected shutdown of the Pernis refinery.
The August gasoil crack is slightly down at $ 14.40 /bbl. The regrade for August is unchanged at -$0.90 / bbl.
Refinery operations disruptions in the U.S. and Europe have supported the fuel oil market even though key storage/trading hubs of Amsterdam-Rotterdam-Antwerp (ARA), Fujairah and Singapore remain well stocked.
The 180 cst August crack is higher at -$1.45 / bbl. The visco spread is at $0.85 /bbl.
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.
Disclaimer : All the views are the author’s personal views. These do not constitute an advice to buy or sell any commodity