Crude Oil
Crude prices settled slightly lower on Thursday, extending the previous session’s losses as the escalating China-U.S. trade dispute casts doubt over the outlook for oil demand. Brent crude futures fell 21 cents to settle at $72.07 a barrel. U.S. crude fell 13 cents to $66.81 a barrel.
China will impose tariffs of 25 percent on a further $16 billion in U.S. imports ranging from fuel and steel products to autos and medical equipment. Crude oil will be exempt.
Saudi Arabia’s energy minister said the recent diplomatic row with Canada will not affect crude oil exports, as Riyadh’s policy has always been to keep politics and energy exports separate.
Naphtha
Asia’s naphtha physical crack extended losses with a margin decrease of 28 cents to nearly a three-week low of $104.30 a tonne on Wednesday.
The August crack has dropped to $ 0.00 /bbl.
Gasoline
Asia’s gasoline in contrast extended gains to nearly a 2-1/2 month high of $8.64 a barrel as stockpiles eased.
Singapore’s onshore light distillates stocks which comprise mainly gasoline fell from a near record high of 15.3 million barrels in the previous week to 14.7 million barrels in the week to Aug. 7, official data showed. Light Distillate stocks in Fujairah too dropped by 900 Kb to 4.83 million barrels. Gasoline stocks in Japan, however, rose by 130 kb to 9.46 million barrels.
The balance August crack has however eased to $ 9.40 / bbl.
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Asia’s cash premiums for 10ppm gasoil climbed to their highest in two months on Wednesday as expectations for firmer demand grew, while middle distillate inventories in Singapore slipped to their lowest levels in seven weeks.
Cash premiums for gasoil with 10 ppm sulphur content were at 21 cents a barrel to Singapore quotes, up from 20 cents a barrel on Tuesday.
Cash differentials are also getting a boost from operational issues at Shell’s Pulau Bukom refinery in Singapore this week, which might help tighten supply fundamentals.
Meanwhile, cash premiums for jet fuel fell to 8 cents a barrel to Singapore quotes, as the prompt-month time spread narrowed its backwardated structure.
Singapore onshore middle distillate stocks dipped close to 9 percent in the week to Aug. 7 to 9.08 million barrels, International Enterprise (IE) data showed. Stocks in Fujairah, however, increased by 255 kb to 2.93 million barrels.
The balance August crack is steady at $ 14.50 / bbl with the 10 ppm crack at $ 15.40 /bbl. The regrade is steady at $ 0.35 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Time spreads and refining margins of 380-cst fuel oil firmed on Wednesday, despite limited trade activity, clawing back losses in the previous session.
This came as Singapore’s weekly onshore fuel oil inventories fell for a third straight week to a more than nine-year low of 14.348 million barrels. Singapore residual fuel stocks are now at their lowest since July 2009 after 451,000 in the week to Aug.7. By contrast, fuel oil inventories at the Fujairah Oil Industry Zone (FOIZ) edged 0.3 percent higher, up for a third straight week, to a fresh 2018 high of 10.353 million barrels
The balance August 180 cst crack is marginally stronger at -$ 0.90 / bbl with the visco spread at $ 1.05 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
We will only be able to update this section on Monday due to circumtances beyond our control
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.
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.