Oil prices settled marginally lower on Tuesday in volatile trade. Brent crude settled down 11 cents at $58.24 a barrel. WTI crude settled 12 cents lower at $52.63 / bbl.
Early in the session, both Brent crude and West Texas Intermediate (WTI) rose more than 1%. But, later in the day, prices as Washington’s blacklisting of more Chinese companies dampened hopes for a trade deal between the two countries.
Investors were cautious ahead of U.S.-China trade talks in Washington on Thursday. U.S. President Donald Trump said a quick trade deal was unlikely. Washington is moving ahead with discussions over possible restrictions on capital flows into China, with a focus on investments by U.S. government pension funds.
The U.S. Energy Information Administration (EIA) cut its 2020 world oil demand growth forecast by 100 kbpd to 1.30 mbpd. The EIA also said that U.S. crude production is expected to rise by 1.27 million bpd in 2019 to a record 12.26 million bpd, slightly above its previous forecast for a rise of 1.25 million.
Oil prices were also pressured by an unexpected decline in U.S. producer prices in September, which could give the Federal Reserve room to cut interest rates again this month. U.S. stocks tumbled and the pan-European STOXX 600 index fell 1%.
International Monetary Fund (IMF) Managing Director Kristalina Georgieva warned that global economic deceleration could turn into “a more massive slowdown” without action to resolve trade conflicts and support growth.
Oil prices drew some support from protests in OPEC members Iraq and Ecuador which threatened to disrupt their oil output. In Iraq, protests resumed overnight in Baghdad’s Sadr City district. Turkey said it had completed preparations for a military operation in northeast Syria after the United States began pulling back troops. Ecuador’s energy ministry said protests against austerity could reduce its oil output by 59,450 bpd.
Prices extended losses slightly in post-settlement trade after American Petroleum Institute data showed U.S. crude inventories rose by 4.1 million barrels in the week ended Oct. 4, far surpassing the 1.4 million barrels analysts had forecast.
Asia’s naphtha crack edged up 2% on Tuesday to touch an 11-month high of $67.95 a tonne as supplies tightened.
Naphtha arrivals in Asia this month from the West including Europe and the Mediterranean are seen recovering from a three-month low of about 1.1 million tonnes in September to a two-month high of about 1.3 million tonnes. But Middle Eastern naphtha supplies to Asia this month at up to 2.2 million tonnes are down from an average monthly of up to 2.5 million tonnes for the first nine months of this year.
The October crack is higher at – $ 3.50 / bbl.
The November crack is at – $ 3.35 / bbl.
No fresh news on gasoline markets.
The October crack is higher at $ 9.15 /bbl
The November crack is at $ 7.40 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Asia’s 10ppm gasoil cash premium to Singapore quotes stayed firm at 85 cents a barrel, unchanged from Monday after the value hit an 11-month high due to strong demand and squeezed supplies.
Some North Asian refineries including those in Taiwan, Japan and South Korea are in turnaround mode. In Europe, around 1.9 million barrels per day of refining capacity is under maintenance this week for seasonal turnaround, the highest this autumn.
The October crack for 500 ppm Gasoil is higher at $ 17.00 /bbl with the 10 ppm crack at $ 18.00 / bbl. The regrade is at + $ 0.00 /bbl
The November crack for 500 ppm Gasoil is at $ 17.00 /bbl with the 10 ppm crack at $ 18.00 / bbl. The regrade is at + $ 1.00 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Asia’s high-sulphur fuel oil (HSFO) market continued to slide on Tuesday as the global marine fuels market gradually transitions towards lower-sulphur alternatives before the new rules, which limit sulphur content to 0.5%.
Cash premiums for 380-cst HSFO fell for an eighth straight session to $16.25 a tonne to Singapore quotes, the narrowest premium in nearly 1-1/2 months. The lower cash premiums came despite elevated trade liquidity for cargoes of the fuel in the Singapore trading window totalling 160,000 tonnes, a five-week high.
Hit by expectations of falling demand for high-sulphur fuels ahead of the 2020 deadline, the front-month 380-cst HSFO barge crack widened its discount to Brent crude to a near record low of minus $25.68 a barrel on Tuesday.
The October 180 cst crack is higher at -$ 15.25 / bbl with the visco spread at $ 0.90 /bbl.
The November 180 cst crack is at -$ 15.30 / bbl with the visco spread at $ 2.70 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
No fresh action for today.
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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.