Oil rose for a third straight day on Wednesday as investors felt more comfortable with risk a day after the Federal Reserve chair’s remarks eased concerns about future interest rate hikes.
London-traded Brent crude for March delivery settled up $1.40, or 1.7%, at $85.09. The global crude benchmark rose just under 5% over the past two sessions, after tumbling 7.5% last week, to a three-week low of $79.62.
New York-traded WTI crude for March delivery settled up $1.33, or 1.7%, at $78.47 per barrel. WTI had risen more than 5% in the prior two sessions after plunging 7.5% last week, to a three-week low of $73.11, on recession fears and the uncertainty about the direction for U.S. interest rates after huge employment gains among Americans in January threatened to bump up inflation again.
Oil prices rose for a third day in a row as bulls in the space were defiant on Wednesday to data showing a seventh straight build in weekly crude stockpiles amid rising production and falling exports. Oil bulls also ignored news that Turkey resumed crude-oil flows to the Mediterranean export terminal of Ceyhan late on Tuesday following two devastating earthquakes in the region. Operations at the 1 million barrel-per-day export terminal, which provides Azeri crude oil to international markets, were halted on Monday and were supposed to have remained shut until the end of Wednesday at least.
The only thing materially bullish for oil and other commodities on Wednesday was a weakening of the dollar, which experienced a modest drop.
DOE Data
The DOE data showed builds across the board.
The rise in gasoline stockpiles raised questions about demand for the automotive fuel as warmer-than-usual winter weather should have, theoretically, seen more people get behind the wheel at this time of the year versus seasonal norms. The build in distillates is also bucking trends as demand for heating oil would be stronger now, if not for the unusually warm winter.
The Material Balance table also shows that the reports are directionally consistent.
Product Data likely to be unavailable till Friday.
The March crack is lower at -$4.05 per barrel
Product Data likely to be unavailable till Friday.
The March crack is lower at $15.55 per barrel.
Click Here for a graphical depiction of Global Gasoline stocks by region.
Product Data likely to be unavailable till Friday.
The March crack for 10 ppm Gasoil is lower at $25.65 /bbl. The 10 ppm regrade is at -$0.50 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Product Data likely to be unavailable till Friday
The March crack for 180 cst FO is higher at – $18.40 /bbl with the visco spread at $2.05 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
No fresh trades for today. However, we may hedge more gasoline should gasoline Q2 crack rise above $14.00 / 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 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.