Oil prices continued to rise as the OPEC+ group continued to debate over the level of production hike.
Brent Crude settled at $76.17 per barrel, up 0.4% on the day and flat on the week. Brent did a final pre-weekend trade of $76.06.
WTI crude soared to as high as $75.62 per barrel, a peak not seen since 2018, before settling Friday’s trade at $75.16, down 7 cents on the day. WTI did a final pre-weekend trade of $75.04. For the week, it rose 1.5%.
US energy firms added 4 oil rigs to total 376 (+191 YoY), the highest since Apr’20, according to Baker Hughes, as oil prices rose to their highest since 2018, prompting some drillers to return to the wellpad.
Money managers cut their net long US crude futures and options positions by 9,499 contracts to total 418,336 in the week to 29 Jun’21, the US CFTC said on Friday.
At a global level, the death toll from the COVID-19 virus rose to 3.99 Million (+6,007 DoD) yesterday. The total number of active cases rose by 20,000 DoD to 11.66 million. (Click here for details).
Asia’s naphtha crack rose on Friday, surging to its strongest level so far this year, supported by steady demand from South Korea and lower western arbitrage arrivals last month.
The naphtha crack climbed to $120.08 per tonne on Friday, a level not seen since December 2019. The crack was at $118.03 per tonne in the previous session, and has gained 17.6% last week.
The July crack is lower at $1.45 / bbl
The August crack is at $1.85 / bbl
Asia’s gasoline crack rose 58 cents to $8.05 per barrel on Friday.
Indian state refiners’ gasoline and gasoil sales rose in June compared with a month earlier, preliminary industry data showed on Thursday, as states across the country eased coronavirus-related restrictions as cases fell.
Gasoline sales by state refiners rose 29.4%, while diesel sales were up 18.5% in June compared with May, the data showed. Sales of gasoline were up 5.7% from the same period in the previous year, but diesel sales were down 1.8%, the data showed.
Light distillate inventories in ARA rose rose 11.1% to about 1 million tonnes in the week to July 1, data from Dutch consultancy Insights Global showed.
The July crack is lower at 9.30 / bbl
The August crack is at 10.30 / bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Cash differentials for 10 ppm gasoil narrowed to a discount of 9 cents per barrel to Singapore quotes on Friday.
ARA gasoil inventories dropped 5.5% to 2.3 million tonnes in the week ended July 1, data from Dutch consultancy Insights Global showed.
Cash differentials for jet fuel widened by 2 cents to a discount of 48 cents per barrel to Singapore quotes on Friday, while the July/August time spread stayed in a contango structure to trade at minus 35 cents per barrel.
The July crack for 500 ppm Gasoil is higher at $5.90 /bbl with the 10 ppm crack at $ 7.40 /bbl. The regrade is at -$ 1.20 /bbl.
The August crack for 500 ppm Gasoil is at $7.10 /bbl with the 10 ppm crack at $ 8.60 /bbl. The regrade is at -$ 0.85 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Cash premiums for cargoes of both grades of high-sulphur fuel oil (HSFO) jumped to multi-month highs on Friday, lifted by an abrupt rise in buying interest for physical cargoes that began on the first day of July.
Cash premiums for 180-cst and 380-cst HSFO were both at over three-month highs of $2 a tonne and $1.48 a tonne to their Singapore quotes, respectively.
At the start of the week, the 180cst HSFO cash differential was at a $1.02 a tonne discount and at minus 90 cents for 380-cst HSFO.
The VLSFO cash premium, however, slipped to a 67 cent per tonne premium on Friday, down from an over two-month high of 70 cents in the previous session but up from a 90 cents per tonne discount at the start of the week.
ARA fuel oil stocks fell by 63,000 tonnes, or 4%, to a three-week low of 1.44 million tonnes in the week ended July 1, data from Dutch consultancy Insights Global (IG) showed. Compared with last year, the inventories at the ARA hub were 4% lower but were above the five-year seasonal average of 1.36 million tonnes.
The July crack for 180 cst FO is lower at -$6.45 /bbl with the visco spread at $1.25 /bbl.
The August crack for 180 cst FO is at -$5.60 /bbl with the visco spread at $1.25 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
After a long time, we are going to be placing a hedge today for the August gasoline crack at $10.30 /bbl. We hope to actually lose money on this one, but these levels have not been seen for a long time now. We shall also look to hedge the Jap Nap crack should that cross $2 / 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 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.