Crude Oil

Oil markets resumed their uptrend yesterday on renewed optimism that non OPEC producers may agree to cut production as well subsequent to the OPEC decision.  WTI fell gained $1.07 / bbl  to settle at $ 50.84 /bbl, while Brent gained up $0.89 /bbl to settle at  $53.89 / bbl.

Non OPEC producers are expected in Vienna to firm an agreement to cut production on their part as well. Russia is expected to cut 300 Kb/d. We see to reason to change our view that fundamentally, supplies will continue to remain ample even if everybody adheres to their stated levels of production which is a challenge in itself.

The physical Naphtha crack recovered marginally today, but the forward outlook still remains weak.

The January crack is showing a value of -$1.4 /bbl


The gasoline market was a lot weaker yesterday as markets absorbed the product build of 3.4 million barrels in the US. A draw 800 Kb in Singapore was not enough to offset the sense of overhang.

The January crack fell to around $10.5 / bbl.

Middle Distillates

The gasoil crack deteriorated yesterday to $ 11.10 /bbl for January. Winson Oil was the largest seller of 27 cargoes traded in the window yesterday.  It seems to have taken good advantage of the huge jump in crude prices to record levels to take profit on its purchases which it may have hedged using a contango trade.

The regrade continues to slip. The value for January was  at a level of $ 1.45 /bbl.

Fuel Oil

Physical premiums slipped in the window yesterday, but the market still remains wary of tight supplies as inventories of residual stocks fell by 15,000 tonnes in the past week.

The January crack is valued at -$1.70 today. February is valued at -$ 2.5 /bbl.  We would considering selling a little of the February crack at these levels given the uncertain markets.

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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