Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil had its best month in three for September, gaining almost 10%. It made a strong debut for October as well, based on the euphoria over Merck’s Covid pill, despite OPEC+ reportedly planning to push out more barrels to the market than initially planned.

Brent crude finished Friday’s session at $79.28 per barrel, up 97 cents, or 1.2%.  Brent rose 1.9% on the week. For  September, it gained 7.6%, its most since June. For the third quarter, the global crude benchmark rose 4.5%.

WTI crude settled October’s first session up 85 cents, or 1.1%, at $75.88 per barrel. For the week, WTI rose 2.6%. For September, it gained 9.5%, its most since June. For the third quarter, the U.S. crude benchmark rose 2%.

Reliance Industries has set up a $1 million oil and petrochemicals trading unit in the UAE as it invests $2 billion in a petrochemicals project being developed by Abu Dhabi National Oil Co. Reliance Industries plans to invest $2 billion in the UAE’s TA’ZIZ chemical joint venture between ADNOC and sovereign wealth fund ADQ, becoming the Indian company’s first deal in the Gulf region, according to a June 29 statement.

At a global level, the death toll from the COVID-19 virus rose to 4.82 Million (+4,582 DoD) yesterday. The total number of active cases by 50,000 fell DoD at 18.33 million. (Click here for details).

Asia’s naphtha crack inched higher despite a rise in European stocks, as crude oil prices dropped to $78.

The refining margin rose to $133.63 a tonne from $132.33 on the previous day. However, the prompt, inter-month spread narrowed in backwardation for a third straight day to $5.25 /MT.

Naphtha stocks at Europe’s ARA hub rose to 274,000 tonnes last week from 267,000 tonnes.

The October crack is lower at $3.45 / bbl.

Asia’s gasoline crack rose for a second consecutive session on Friday as European stocks held steady, while a series of trades at the window indicated firm demand.

The crack rose to $7.85 a barrel from $7.40 in the previous session.

Gasoline stocks in ARA rose to 816,000 tonnes from 813,000 tonnes, data from Insights Global showed.

The October crack is lower at $9.85 / bbl.


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

Asian refining margins for 10 ppm gasoil rose for a third straight session on Friday, surging to their strongest in more than 20 months, boosted by steady arbitrage demand from the West amid tighter supplies.

Cash differentials for gasoil with 10 ppm sulphur dipped 11 cents to 34 cents per barrel to Singapore quotes on Friday.

Refining margins, also known as cracks, for 10 ppm gasoil soared to $13.29 per barrel over Dubai crude during Asian trading hours, the strongest since January last year. They were at $12.86 per barrel a day earlier.

Gasoil stocks in ARA rose 1.6% to 2 million tonnes in the week ended Sept. 30, according to Dutch consultancy Insights Global.

Asia’s cash differentials for jet fuel were at a discount of 4 cents per barrel to Singapore quotes on Friday, compared to a discount of 5 cents per barrel a day earlier.

The October crack for 500 ppm Gasoil is higher at $11.05 /bbl with the 10 ppm crack at $ 13.05 /bbl. The regrade is at -$ 0.40 /bbl. 

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

Asia’s high-sulphur fuel oil (HSFO) market dipped on Friday, with cash premiums and front-month time spreads edging lower.

ARA fuel oil stocks fell by 5%, or 60,000 tonnes, to a two-week low of 1.16 million tonnes in the week ended Sept. 30, data from Dutch consultancy Insights Global (IG) showed.

The October crack for 180 cst FO is lower at  -$1.15 /bbl with the visco spread at $2.45 /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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