Crude Oil

Oil futures fell 1% on Friday as Russia said it needed more time before committing to output cuts sought by other large producers. Brent futures fell 46 cents to settle at $54.47 a barrel. WTI crude futures fell 63 cents to settle at $50.32 a barrel.

Oil prices posted their fifth straight weekly decline. Brent sank 6.3% for the week while WTI lost 2.4%.

The death toll from the coronavirus in mainland China rose to 909 (+97 DoD) at the end of Thursday. Across China, the total number of confirmed infections was 40,235 (+3,037 DoD).

China’s producer prices in Jan’20 rose 0.1% YoY, official data showed on Monday, marking the first pickup since May’19. Consumer prices rose 5.4% YoY compared with a 4.5% rise in Dec’19, the fastest since Oct’11.

Last week, a panel advising OPEC+ suggested provisionally cutting output by 600 kbpd. On Friday, Russia Energy Minister Alexander Novak said Moscow needed more time to assess the situation. Producers in OPEC+ are scheduled to meet in Vienna on March 5-6, although the meeting could be brought forward because of concerns surrounding the virus.

US energy firms added oil rigs for the 3rd time in 4 weeks, adding 1 rig to total 676 (-178 YoY), even though producers planned to continue reducing spending on new drilling for a 2nd consecutive year in 2020, according to Baker Hughes.

Money managers cut their net long U.S. crude futures and options positions in the week to Feb. 4 by 55,512 contracts to 162,518, the U.S. CFTC said on Friday.


No fresh news on the Naphtha markets.

The March crack has improved to – $ 1.90 / bbl. 


Asia’s gasoline crack extended gains to hit a two-month high of $8.54 a barrel on Friday, as supplies contract on the back of hefty run cuts in China and moderate reduction in gasoline-making units elsewhere in Asia.

China’s February gasoline shipments, including cargoes being shipped out and cargoes placed on provisional bookings, are assessed at up to 45 KT so far.

Taiwan and South Korea have trimmed output at their FCC units that produce gasoline..

The March crack has jumped to $9.45 /bbl

Click Here for a graphical depiction of Global Gasoline stocks by region.


Cash premiums for gasoil with 10 ppm sulphur content were at 61 cents per barrel to Singapore quotes on Friday, compared with 69 cents per barrel a day earlier.

Cash differentials for jet fuel flipped to a discount of 13 cents per barrel over Singapore quotes on Friday, compared with a premium of 9 cents a barrel on Thursday.

The regional jet fuel demand remains under pressure as global airlines have suspended or scaled back flights due to the virus epidemic. Global air passenger traffic for December showed demand rose 4.5% against the same month a year earlier, while demand for the full-year 2019 climbed 4.2% compared with 2018, the IATA said on Thursday. Passenger traffic for Asia-Pacific airlines increased 4.5% in 2019, a steep decline compared to 8.5% growth in the preceding year, according to IATA.

The March crack for 500 ppm Gasoil has dropped to $11.75 /bbl with the 10 ppm crack at $ 12.40 / bbl. The regrade is at   -$ 1.50 /bbl. 

Click Here for a graphical depiction of Global Distillate stocks by region.

Fuel Oil

Asia’s front-month crack for 0.5% VLSFO inched lower on Friday, posting their biggest weekly drop in three weeks amid sloppy demand due to the coronavirus epidemic in China.

The front-month VLSFO crack dipped to $19.18 per barrel above Brent crude during Asian trade on Friday, down from $19.24 a barrel on Thursday. The VLSFO cracks have shed 12.7% this week in their largest weekly decline since Jan. 17.

The 380-cst HSFO barge crack for March widened its discount to minus $16.21 a barrel to Brent, compared with minus $15.85 a barrel on Thursday.

China’s decision to extend its Lunar New Year holiday period until Feb. 10 has compounded logistical complications, despite its ports staying open. China is a vital link to the container sector, transporting everything from fresh food to phones and designer clothes as well as industrial parts.

The March 180 cst crack is lower at -$ 10.50/ bbl with the visco spread at  $ 1.20 /bbl.

Click Here for a graphical depiction of Fuel Oil stocks by region.

Hedge Recommendations

No fresh action for today. 

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.

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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