12 Apr 2017

Crude Oil

After spending most of the day in negative territory, Brent futures rose by 25 cents to settle at $ 55.98 / bbl while WTI gained  32 cents to settle at $ 53.40 /bbl.

The sole reason for the late rally was a report that Saudi Arabia advised OPEC officials that it was in favor of extending the production cuts. No particular individual was quoted on this.

In our opinion, this is a merely cartelization and spooking the market.  We fail to understand why this sort of behavior is acceptable to the OECD when both the US as well as the EU frown in general on any form of monopolization or oligopolization. While this may appear a rant, it is high time that the world learns to stop welcoming bullying merely because people can make money off such bullying.

API data

With that out of the way, the API reported that crude stocks dipped by 1.3 million barrels to 532.3 million barrels. Gasoline stocks dipped by 3.7 million barrels while distillate stocks drew by 1.6 million barrels.  Given that the market consensus was for a 600 kb draw in crude stocks, this report can be considered bullish.

Naphtha

Naphtha markets slumped yesterday mainly due to cracker outages in Singapore, Malaysia and possibly India. ONGC offered a surprise 30 KT parcel out of Paradip yesterday. The April Japan Naphtha Crack slipped into negative territory at -$ 0.05 /bbl while the May crack is valued at – $ 0.6 /bbl.  Singapore Naphtha is valued at -$ 1.25 /bbl in April and -$2.25 in May

Gasoline 

Gasoline cracks also slumped, arguably in synch with Naphtha prices. The April crack is valued at  $ 12.0 /bbl. The May-June spread came in further yesterday with the value now being report at 20 cents / bbl.

Middle Distillates

Diesel crack prices continued to hold steady today. The value of the April Gasoil crack is $ 11.7 / bbl and May is $11.30/bbl.  The regrade, however, continued to sink.  April is valued at -$ 0.45.  and the May regrade has once again returned to negative territory at -$ 0.05 /bbl today.

180 CST Fuel Oil

The trading play in Singapore Fuel oil is still continuing as thirteen 380 cst cargoes were traded yesterday in additon to a single 180 cst cargo.

Yesterday however, saw suppliers emerge to sell aggressively into the play.  Balance April has receded further to  -$ 3.9 /bbl and May at -$4.2 /bbl

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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