Oil prices fell in thin trade on Thursday. Brent crude futures dropped 52 cents to settle at $63.30 a barrel. WTI crude futures were trading at at $ 56.89 a barrel (there being no settle).
Trading volumes were light due to the July 4 holiday in the United States. Markets appeared largely unmoved by the detention by British Royal Marines of a supertanker in Gibraltar possibly carrying Iranian crude oil bound for Syria.
Asia’s naphtha crack rose for a second session on Thursday to reach a near 7-week high.
The July crack is stronger at -$ 4.90 /bbl
Asia’s gasoline margin hit a two-month high of $6.36 a barrel. More than 650 KT of gasoline were booked for the US this month from Europe.
Gasoline demand in the West in the meantime was firm. Exports from Europe to the U.S. East Coast had risen in recent days to plug a supply gap after the 335 kbpd Philadelphia Energy Solutions Inc refinery was shut down.
Light distillate stocks in Singapore fell by 808 kb to 711.43 million barrels.
The July crack is lower at $ 8.15 / bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Cash differentials for 10ppm gasoil were at a discount of 19 cents a barrel to Singapore quotes, as against a 16-cent discount a day earlier.
Cash premiums for jet fuel were at 21 cents a barrel to Singapore quotes on Thursday, levels not seen since November last year. They were at a premium of 13 cents a barrel on Wednesday.
Asia-Pacific airlines posted a drop of 6.4% in air freight demand in May, compared with the same month a year ago, the IATA said.
Middle distillate stocks in Singapore fell by 799 kb to 10.59 million barrels.
The July crack for 500 ppm Gasoil is lower at $ 14.25 /bbl with the 10 ppm crack at $ 14.95 / bbl. The regrade is at +$ 0.45 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Bullish fundamentals fuelled by tightening near-term supplies continued to boost Asia’s fuel oil markets, propelling the 380-cst front-month time spread to a fresh record high on Thursday.
The front-month Aug/Sept 380-cst time-spread widened its backwardated structure to a record $20.50 per tonne, up from $19.25 per tonne in the previous session.
Similarly, solid buying interest lifted cash premiums for 380-cst fuel oil to a more than 7-year high at $11.63 a tonne to Singapore quotes, up from $8.55 a tonne in the previous session.
Fuel Oil stocks in Singapore fell by 3.28 million barrels to a 3 month low of 19.56 million barrels to 18.58 million barrels.
The July180 cst crack has jumped further to + $ 3.60 / bbl with the visco spread at $ 0.95 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
As Fuel Oil cracks go on jumping, we shall lay one more tranche of the August crack at + $ 1.20 /bbl. We shall look at September Fuel Oil should it drop below -$ 1.00 / 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 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.