13 Mar 2017
oil-barrel

Crude Oil

Crude oil futures broke through many supports on Friday as more players appeared  to get convinced that there appeared to be no great price rise likely due to OPEC cutting production.  Brent lost $0.82 to settle at $ 51.37 / bbl. WTI lost  79 cents to settle at $ 48.49 /bbl.  These levels have not been since since November 30th last year when crude began its upward spike.

The drop showed in outstanding futures positions as reported by CFTC. Speculators cut positions in WTI  futures to 508,500 lots from 525,300 lots a week before. In the meanwhile, the impending fall did not appear to have fazed US producers from adding 8 more rigs to bring the total rigs outstanding to 617.

Technical Analysis

 

 

Crude Oil futures broke through several key support levels in the last week.  The multi bottom support of 54.75 was simply shattered out of existence.  Crude prices have retraced more than 76.4% of their climb

from end November.  Supports for now seem to be at 50.75 levels followed by 48.90 below.   Resistances would be at 51.6 and 53.0 above.  On the weekly charts,  supports show up at 51.25 (50 WMA) and 49.60.  However, at the time of writing, Brent is already trading close to 51.00, therefore this support seems to be being challenged.

Naphtha

The Naphtha physical crack recovered to much better levels as crude prices dropped.  However, supplies for April appear to be more than adequate as the product is selling for discount to marker quotes.  The MOPJ crack for both March and April is valued at  $ 1.0 / bbl.  The Singapore crack for March is valued at  – $ 0.5 /bbl whereas April is closer to -$ 1.0 /bbl.

Gasoline 

Gasoline continued to ease albeit marginally.  We need some significant draw in gasoline stocks for the crack to improve in a meaningful way.

The March crack is valued $ 10.80 /bbl while the April crack is valued at $ 10.70 /bbl.

Middle Distillates

Gasoil prices too have continued to slip.  The March crack is now at $11.7 / bbl.  The regrade has slipped back to -$ 1.0 /bbl. While the April crack is around 20 cents lower at $ 11.5 / bbl, the regrade in April is significantly better at – $ 0.45 /bbl

180 CST Fuel Oil

Fuel Oil continues to hold its own in the markets.  While both Europe too is awash with stocks, the Singapore situation is preventing the arb from open and, curiously enough, holding up prices.  The March crack is valued at  -$ 3.45/bbl and April around -$ 3.4/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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