Crude Oil
WTI crude oil prices slipped below $60 a barrel Tuesday, on growing expectations that major oil producers will agree to ease production cuts at a key meeting this week on bets that crude demand will likely outstrip supply as the global vaccine-led recovery gathers pace.
Brent futures settled down 90 cents at $62.79. WTI crude settled down 89 cents to settle at $59.75 per barrel.
Ahead of the OPEC and non-OPEC producers virtual meeting due Thursday, Saudi Arabia and Russia reportedly disagree over whether to stick with or twist output cut pledges agreed to last year. Russia is expected to push for a further increase in supply, while Saudi is eager to keep supplies tight in order to take advantage of higher prices.
ADNOC has told Asian oil buyers that having cut its Mar’21 term supply nominations by 10-15%, it plans to reduce cuts to 5% for Apr’21, sources close to the matter matter told Reuters ahead of an OPEC+ meeting..
api data
While crude stockpiles jumped, product stocks have shown massive draws. We will wait for official data tomorrow
covid 19
At a global level, the death toll from the COVID-19 virus rose to 2,559,436 (+9,392 DoD) yesterday. The total number of active cases rose by around 110,000 DoD to 21.63 million. (Click here for details)
Naphtha
No fresh news on the naphtha market.
The March crack is lower at $2.30 /bbl
Gasoline
India’s fuel consumption could rise by 9.8% in the year to Mar’22, its highest pace of growth in six years, driven by robust demand for gasoline and gasoil in Asia’s third largest economy, according to initial government projections.
The March crack is lower at $7.40 /bbl.
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Air passenger traffic in Jan’21 was 72.0% below the equivalent level in 2019, worse than Dec’20’s YoY 69.7% decline, IATA data showed 2 Mar’21.
The March crack for 500 ppm Gasoil is higher at $5.95 /bbl with the 10 ppm crack at $ 7.25 / bbl. The regrade is at -$ 1.40 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Despite falling crude oil prices, Asia’s 0.5% very low-sulphur fuel oil (VLSFO) crack plummeted to its lowest level in a month on Tuesday, erasing steady gains throughout most of February amid expectations of easing supply constraints, trade sources said.
Western arbitrage arrivals were expected to total over 3.1 million tonne in March compared with about 2.5 million tonnes in the previous month, the sources said.
The front-month VLSFO crack fell for a fourth consecutive session to $13.64 a barrel above Dubai crude oil prices, down from $14.32 in the previous session and a one-year peak of $15.90 on Feb. 23, according to Refinitiv data on Eikon.
The March crack for 180 cst FO is lower at -$3.80 /bbl with the visco spread at $0.80 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
We shall hedge the April Jap Nap – Dubai crack at current levels of $2.20/bbl.
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.