Crude Oil
Oil prices ended Tuesday little changed. Brent crude futures fell 12 cents to settle at $62.06 a barrel. WTI crude fell 6 cents to settle at $56.80 a barrel.
Prices pared earlier gains after Trump’s remarks to a lunch gathering of The Economic Club of New York included mixed messages about U.S.-China trade talks and excluded specifics about any progress in negotiations. Trump said U.S. and Chinese negotiators were “close” to a “phase one” trade deal, but largely repeated well-worn rhetoric about China’s “cheating” on trade.
Weekly energy data has been delayed a day due to the Veterans Holiday on Monday.
Naphtha
Asia’s naphtha crack reached a one-week high of $73.40 a tonne.
Demand for naphtha, however, was mostly muted from North Asia. Eyes were also on ADNOC’s term negotiation where it had pegged offers last week for four naphtha grades for first-half of 2020 shipment at $25 to $29 a tonne premium to its own price formula on a free-on-board (FOB) basis. This was an increase of at least 80% when compared to its contract sealed for the four grades scheduled for 2019 shipment.
The November crack is lower at – $ 3.95 / bbl.
The December crack is at – $ 3.85 / bbl.
Gasoline
Asia’s gasoline crack hit a near 6-week high of $10.72 a barrel on Tuesday as strong demand pushed the latter higher.
A continuous stream of demand from India and Asia’s top gasoline importer Pertamina were supporting the gasoline sector. Indonesian state-owned Pertamina was looking to buy a 200 KB of 88-octane grade for Dec. 1-3 arrival at Balongan through a tender closing on Nov. 15. The refiner has outstanding tenders to buy gasoline for first-half 2019 delivery. India on the other has been regularly importing gasoline to fill a gap as its refineries are taking turns to shut for upgrading works as cleaner fuels would be used from next year.
The November crack is lower at $ 8.80 /bbl
The December crack is at $ 7.45 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Cash premiums for gasoil with 10 ppm sulphur content fell for a sixth straight session on Tuesday to a six-week low of 39 cents per barrel to Singapore quotes, compared with a 50 cent premium on Monday.
The gasoil cracks in Asia have come under pressure as some regional refineries, undergoing planned maintenance, are returning to production, while India is exporting more on the back of weaker demand in its domestic market. Indian state-run refiners including Indian Oil Corp, Mangalore Refinery and Petrochemicals and Bharat Petroleum Corp Ltd have all ramped up their gasoil exports in recent weeks.
Meanwhile, cash differentials for jet fuel widened their discounts to 56 cents per barrel to Singapore quotes on Tuesday, compared with a discount of 52 cents per barrel on Monday.
The November crack for 500 ppm Gasoil is lower at $ 12.50 /bbl with the 10 ppm crack at $ 13.50 / bbl. The regrade is at $ 0.70 /bbl
The December crack for 500 ppm Gasoil is at $ 13.60 /bbl with the 10 ppm crack at $ 14.55 / bbl. The regrade is at $ 1.35 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Asia’s cash premiums for mainstay 380-cst high-sulphur fuel oil (HSFO) dropped on Tuesday to their lowest in nearly three months, weighed down by falling demand ahead of a switch to cleaner marine fuels starting next year.
The cash premium for 380-cst HSFO plunged to $10.80 per tonne to Singapore quotes on Tuesday, the lowest since Aug. 14. They were at a premium of $19.08 per tonne a day earlier.
The 380-cst November/December time spread narrowed its backwardated structure to trade at $6.75 a tonne on Tuesday, compared with $11.50 a tonne in the previous session, Refinitiv data showed.
The December 380-cst barge crack widened its discount to minus $30.55 a barrel, as against minus $30.31 on Monday, data from Refinitiv Eikon showed.
The November 180 cst crack is lower at -$ 23.75 / bbl with the visco spread at $ 0.60 /bbl.
The December 180 cst crack is at -$ 22.70 / bbl with the visco spread at $ 1.50 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
No fresh action 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.