Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Crude prices were little changed on expectations that Thursday’s meeting of the 13 member OPEC+ group will reject consuming countries’ demands for more oil to keep a lid on a market that has nearly doubled in value over the past year.

Brent crude  finished the session up 1 cent at $84.72 per barrel. WTI crude settled down 14 cents, or 0.2%, at $83.91 per barrel.

This morning though, in the wake of the API data, prices have dipped by as much as 70 cents at the time of writing.

api data

The API data was distinctly bearish with builds across the board. The only ray of hope was that distillate stocks built less than expected. Markets will await the official data release later today.

At a global level, the death toll from the COVID-19 virus rose to 5.03 Million (+6,798 DoD) yesterday. The total number of active cases was unchanged  DoD at 18.28 million. (Click here for details).

Asia’s naphtha crack extended gains on Tuesday and touched more than seven-year high amid firm feedstock demand from petrochemical units.

The refining profit margin climbed to $173.98 a tonne, the strongest since July 2014, from $167.85 in the last session. Naphtha margins have gained nearly 50% since September.

“Naphtha demand continued to find firm support as a cracker feedstock amid persistently more expensive prices for propane, with robust buying interest from petrochemical producers pushing premiums for spot cargoes higher,” Refinitiv Oil Research said in a report.

The November crack is higher at $5.65 / bbl.

Asia’s gasoline crack eased slightly but remained strong above $15 per barrel on signs of robust consumption growth with easing of pandemic restrictions.

The crack slipped to $15.47 a barrel from $15.98 in the previous session.

The November crack is higher at $15.35 / bbl.

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

Cash differentials for gasoil with 10 ppm sulphur content, were at a premium of 79 cents per barrel to Singapore quotes, up from 78 cents per barrel on Monday.

Asia’s cash differentials for jet fuel hit their highest premiums in more than 21 months on Tuesday, as a gradual uptick in flight capacities in some countries boost regional aviation demand.

Cash differentials for jet fuel rose to 29 cents per barrel to Singapore quotes, a level not seen since January 2020. They were at a premium of 20 cents per barrel a day earlier.

Refining margins or cracks for jet fuel slipped 50 cents to $12.35 per barrel over Dubai crude during Asian trading hours as feedstock crude prices gained.

Scheduled airline seat capacity in India jumped 9% in the week to Monday, while flight capacity in Japan was up 10% this week, according to aviation data firm OAG.

The November crack for 500 ppm Gasoil is lower at $11.20 /bbl with the 10 ppm crack at $ 12.50 /bbl. The regrade is at -$ 0.30 /bbl. 

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

Asia’s high-low (HiLo) sulphur price spread climbed on Tuesday, hovering near a two-year high amid bullish low-sulphur market residual fuel fundamentals and a weak high-sulphur fuel oil (HSFO) market.

The front-month HiLo sulphur price spread, the difference between front-month 0.5% very low-sulphur fuel oil (VLSFO) and 380-cst HSFO swaps, climbed to $139.75 a tonne on Tuesday, up by $3.25 from the previous session, Refinitiv data showed.

The front-month VLSFO crack also firmed on Tuesday, climbing to $13.26 a barrel above Dubai crude, despite firming crude oil prices..

The November crack for 180 cst FO is lower at  -$9.35 /bbl with the visco spread at $1.75 /bbl.

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

No Fresh trades 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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