Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil prices rose more than 2% on Thursday as traders preferred to stay long over the long weekend. 

Brent crude settled Thursday’s session at $64.86, up $2.12, or 2.1%. For the week Brent gained 45 cents, or nearly 0.5%.

WTI did a final trade of $61.30 before the Good Friday holiday and weekend. It settled Thursday’s session at $61.45, up $2.29, or 3.8%. For the week, WTI was only slightly higher, rising 48 cents, or 0.8%.

After one year of output cuts, the 23-member OPEC+ – comprising the original 13 members of the Saudi-led OPEC and 10 other oil producing nations steered by Russia – will pump an additional 350,000 barrels per day in May and June, and a further 400,000 daily in July.

All ships stranded by the grounding of the giant container ship Ever Given in the Suez Canal in Mar’21 had passed through the canal by Saturday, ending the backlog that built up during the blockage, the canal authority said

Saudi Arabia increased the price of its Arab light crude for the Asian market by $0.4/bbl MoM in May’21, and lowered those for the US and European markets by $0.1/bbl and $0.2/bbl respectively, according to Saudi Aramco.

The US rig count, as of Thursday, stood at 337. While this is nearly double from its August record low of 172. While that’s less than half of the pre-pandemic rig count of 683.

Hedge funds and other money managers raised their net long US crude futures and options positions by 3,580 contracts to total 394,040 in the week to 31 Mar’21, the US CFTC said on Friday.

At a global level, the death toll from the COVID-19 virus rose to 2,865,513 (+6,490 DoD) yesterday. The total number of active cases rose by around 620,000 over the long week end to 22.85 million. (Click here for details)

Asia’s naphtha crack slipped to $98.15 a tonne on Thursday, down from $98.45 a tonne in the previous session.

The front-month naphtha arbitrage spread was unchanged on Thursday, holding at Wednesday’s two-week low of $13.75 a tone, Refinitiv data in Eikon showed.

The April crack is higher at $1.05 /bbl

Asia’s gasoline crack climbed on Thursday for a fourth straight session, climbing to a more than 13-month high as sentiment was bolstered on signs of improving fuel demand and by regional refinery outages, trade sources said.

The gasoline crack climbed to $7.17 a barrel on Wednesday, up from $7.12 in the previous session and its highest since Feb. 14, 2020.

The April crack is higher at $9.05 /bbl.

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

 Asia’s cash differentials for 10 ppm gasoil weakened on Thursday, weighed down by ample supplies available in the region amid a sluggish demand recovery. Cash differentials for 10 ppm gasoil were dropped a further 2 cents to a discount of 31 cents per barrel to Singapore quotes on Thursday.

Higher exports from China and India in recent weeks, alongside limited scopes of arbitrage opportunities to Europe, is keeping the regional gasoil market grappling with supplies, traders said.

The gasoil EFS traded at around -$11 / MT, continuing to make the East West arbitrage unworkable.

Cash discounts for jet fuel fell further to 65 cents per barrel to Singapore quotes on Thursday. Differentials were at a 60 -cent discount a day earlier.

The April crack for 500 ppm Gasoil is higher at $4.05 /bbl with the 10 ppm crack at $ 5.10 / bbl. The regrade is at -$ 1.45 /bbl. 

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

Asia’s 0.5% very low-sulphur fuel oil (VLSFO) crack against Dubai crude climbed on Thursday, rebounding from a near three-month low hit in the previous session.

The front-month VLSFO crack versus Dubai was at $11.58 a barrel above Dubai crude prices, up from $11.09 a barrel in the previous session, data from Refinitiv Eikon showed.

The April crack for 180 cst FO is unchanged at  -$4.20 /bbl with the visco spread at $0.95 /bbl.

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

No fresh action 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.

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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.

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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