Crude Oil
Oil prices weakened on Monday after new import tariffs imposed by the United States and China came into force, raising concerns about a further hit to global economic growth and demand for crude. Brent crude futures settled 59 cents lower at $ 58.66 /bbl. WTI crude futures were trading 33 cents lower at $54.77 /bbl.
Activity was thin because of the U.S. Labor Day public holiday.
Saudi Arabia on Monday named Yasir al-Rumayyan, the head of its sovereign wealth fund, as chairman of state-run oil giant Aramco, replacing Energy Minister Khalid al-Falih in the position.
In the United States, Hurricane Dorian was forecast to bring heavy rains and a storm surge late Monday through Wednesday to Florida’s Atlantic coast before it moves northward along the coasts of Georgia, and the Carolinas. The National Hurricane Center called for Dorian to spare the U.S. mainland a direct hit.
Naphtha
Asia’s naphtha crack rose to $13.80 a tonne on Monday after falling to its lowest since June 18 late last week.
Nevertheless, the intermonth spread remained in a contango structure for the second straight session after flipping into negative territory for the first time since June 18.
Malaysia’s Pengerang Refining and Petrochemical (PrefChem), which in June had imported naphtha for its new 1.2 million tonnes per year cracker, is now exporting the fuel. It has exported at least two naphtha cargoes, one of which was for late August loading to a trading house. Another cargo for early September loading was sold to oil major BP at discounts in the high teens a tonne level to Japan quotes on a free-on-board (FOB) basis. It may continue to offer naphtha given that its 300,000 bpd refinery is in operational mode, but the status of its cracker is not immediately clear. Petronas, co-owner of PrefChem with Saudi Aramco, did not immediately respond to a request for comment.
The September crack is higher at -6.80 / bbl.
Gasoline
No fresh news on the gasoline markets.
The September crack is lower at $ 6.55 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Cash premiums for gasoil with 10ppm sulphur content were at 26 cents a barrel to Singapore quotes on Monday, compared with a premium of 32 cents per barrel a day earlier.
Cash premiums for jet fuel dipped 3 cents to 8 cents a barrel to Singapore quotes on Monday.
The September crack for 500 ppm Gasoil is lower at $ 15.60 /bbl with the 10 ppm crack at $ 16.45 / bbl. The regrade is at + $ 0.15 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Asia’s cash premiums for mainstay 380-cst high-sulphur fuel oil rose on Monday, hovering near to a record high touched last week, thanks to steady demand and tightening supplies. Cash premiums for 380-cst high-sulphur fuel oil (HSFO) were at $38.50 a tonne to Singapore quotes, compared with $35.84 a tonne on Friday.
The cash differentials hit a record high of $40 a tonne on Thursday. The cash premiums have got a boost especially over the last couple of weeks due to increasingly tight Singapore supplies of HSFO ahead of a shift in global shipping fuel rules set to start next year.
Refining margins for the 380-cst barge crack to Brent crude fell to minus $21.37 a barrel during Asian trading hours, down from minus $16.78 per barrel on Friday.
The September 180 cst crack is lower at – 8.55 / bbl with the visco spread at $ 0.80 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
No fresh recommendations for 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 refiner.
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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.