Crude Oil

Oil prices settled higher on Wednesday on mounting expectations that producing countries will maintain output limits next year.

Brent crude rose 83 cents to $48.25 per barrel. WTI futures rose 73 cents to settle at $45.28 a barrel.

OPEC and Russia resume talks on Thursday in a bid to define policies for 2021 after an initial round of discussions this week failed to bring a compromise on how to tackle weak oil demand amid a second coronavirus wave.

Venezuela’s oil exports almost doubled MoM in Nov’20 to 639 KB/D, from 360 KB/D in Oct’20, as new customers linked to a Russian trading firm stepped in to boost purchases from PDVSA amid US sanctions, according to data from the firm.

India wants to diversify its oil imports, including the resumption of supplies from Iran and Venezuela, after US President-elect Joe Biden takes office, the Indian Oil Minister said on Wednesday.

api data

U.S. crude inventories fell by 679 KB in the week to Nov. 27, according to data from EIA on Wednesday, defying the build the API reported on Tuesday. U.S. oil production rose 100 kbpd last week to its highest level since May, the EIA data showed. The crude draw down is largely due to a jump in exports of 600 kbpd.

Notwithstanding the draw down in crude, we believe the data is bearish given the massive drop in product demand. While some of it may be seasonal, the absolute levels, below 8 mbpd for gasoline and below 3.8 mbpd for distillates are certainly worrisome.

Our Material Balance statement suggests a far lower build of gasoline stocks than actually reported.

covid 19

At a global level, the death toll from the COVID-19 virus rose to 1,498,367 (+12,376 DoD) yesterday. The total number of active cases rose by around 140,000 DoD to 18.40 million.  (Click here for details).


Asia’s naphtha crack fell to a three-session low of $45.98 a tonne on Wednesday. East-bound cargoes arriving this month are seen at up to 2.3 million tonnes versus 1.5 million tonnes in the previous month.

The December crack is higher at – $1.80 /bbl.

The January crack is at – $0.85 /bbl.


Asia’s gasoline crack to Brent declined to a 1-1/2 week low of $1.18 a barrel on ample supplies..

The December crack is higher at $2.15 /bbl

The January crack is at  $2.70 /bbl.

Click Here for a graphical depiction of Global Gasoline stocks by region.


Cash discounts for gasoil with 10 ppm sulphur content widened for a second consecutive session to 23 cents a barrel to Singapore quotes on Wednesday, compared with a 21-cent discount on Tuesday.

The Dec/Jan time spread for 10 ppm gasoil widened its contango structure by 2 cents on Wednesday to trade at a discount of 22 cents per barrel.

Middle-distillate inventories in Fujairah dropped 12.8% to 5.4 million barrels in the week ended Nov. 30, data via S&P Global Platts showed. The weekly stocks in Fujairah have averaged 4.1 million barrels so far in 2020, compared with the weekly average of 2.4 million barrels in 2019.

Asia Pacific air passenger traffic declined for the 9th straight month in Oct’20, tumbling 95.1% YoY, as weakness remained underpinned by prolonged border closures and travel restrictions, the latest AAPA data released on 2 Dec’20 showed.

The December crack for 500 ppm Gasoil is lower at $4.15 /bbl with the 10 ppm crack at $ 4.95 / bbl. The regrade is at   -$ 0.65 /bbl. 

The January crack for 500 ppm Gasoil is at $4.80 /bbl with the 10 ppm crack at $ 5.40 / bbl. The regrade is at   -$ 0.75 /bbl. 

Click Here for a graphical depiction of Global Distillate stocks by region.

Fuel Oil

The front-month viscosity spread fell to $3.50 a tonne on Wednesday, its lowest since early-August.

Fuel oil inventories in Fujairah jumped rose by 1.344 million barrels (19%) from the previous week to a three-week high of 8.615 million barrels data via S&P Global Platts showed. However, Fujairah’s fuel oil inventories were 33% lower than year-ago levels. The inventories hit a near two-year low of 7.271 million barrels, or 1.145 million tonnes, in the week to Nov. 23.

The December crack for 180 cst FO is higher at  -$1.70 /bbl with the visco spread at $0.60 /bbl.

The January crack for 180 cst FO is at  -$1.70 /bbl with the visco spread at $0.70 /bbl.

Click Here for a graphical depiction of Fuel Oil stocks by region.

Hedge Recommendations

No fresh activity 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 refinery.

Click Here to see how all our recommendations have fared

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

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