Oil prices settled 2.2% higher on Thursday after reports of attacks on two oil tankers in the Gulf of Oman. Brent settled up $1.34 at $61.31 a barrel. WTI crude futures ended $1.14 lower at $51.86 a barrel.
Oil tanker owners DHT Holdings and Heidmar suspended new bookings to the Mid-East Gulf. Tensions in the Middle East have escalated since U.S. President Donald Trump withdrew from a 2015 multinational nuclear pact with Iran and reimposed sanctions, notably targeting Tehran’s oil exports.
Iran, which has distanced itself from the previous attacks, has said it would not be cowed by what it called psychological warfare. The episode also fed fears of a new confrontation between Iran and the United States, which blamed Tehran for the incident.
U.S. Secretary of State Mike Pompeo said the United States has assessed Iran was behind the attacks, and arrived at its conclusion based on intelligence, weapons used and the level of expertise needed for the attacks on the tankers in the Gulf of Oman.
Global crude demand growth will come in at 70,000 barrels per day (bpd) less than previously expected this year, around 1.14 million bpd, OPEC projected in its monthly oil market report.
Energy consultancy FGE and British bank Barclays this week revised down their global oil demand growth forecasts to around 1 million bpd from around 1.3 million bpd.
The forecast revisions come as investors grow increasingly worried about trade talks between the United States and China, which may be revived at the G20 summit in Japan in late June.
Asia’s naphtha rose as its physical crack discount narrowed for the fourth straight day on Thursday to 40 cents a tonne to Brent crude, making this the smallest discount since it flipped into the negative zone last week for the first time in over 10 years.
Open-specification naphtha and full-range prices had mostly turned to discounts although heavy full-range naphtha prices are still holding at premium levels in South Korea, the largest importer of naphtha as a country in Asia.
The June crack is higher at – $8.50 /bbl. The July crack is at -$6.85 /bbl
No fresh news on the gasoline markets. Light distillate stocks in Singapore rose by 828 KB to a 5 week high of 12.30 million barrels.
The June crack is higher at $ 4.40 /bbl. The July crack is at $ 5.30 / bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Asia’s cash differentials for 10ppm gasoil narrowed their discounts on Thursday, helped by firmer deals in the physical market after middle distillate inventories in Singapore declined. Cash discounts for 10ppm gasoil were at 19 cents a barrel to Singapore quotes, compared with a discount of 23 cents a barrel on Wednesday.
Singapore’s onshore inventories for middle distillates dropped to a four-week low of 10.52 million barrels in the week to June 12, data from Enterprise Singapore showed on Thursday.
Cash differentials for jet fuel were at a premium of 5 cents a barrel to Singapore quotes on Thursday, compared with a 8-cent premium on Wednesday.
The June crack for 500 ppm Gasoil is higher at $ 12.95 /bbl with the 10 ppm crack at $ 13.65 / bbl. The regrade is at +$ 0.05 /bbl
The July crack for 500 ppm Gasoil is at $ 14.40 /bbl with the 10 ppm crack at $ 15.10 / bbl. The regrade is at +$ 0.15 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Asia’s cash premiums for mainstay 380-cst fuel oil dipped on Thursday, hurt by weaker deal values, while onshore inventories in Singapore climbed to a five-week high.
Cash premiums for 380-cst fuel oil were at $2.08 a tonne to Singapore quotes, compared with $2.50 a tonne on Wednesday. Fuel oil stocks in Singapore rose about 1.6 million barrels to 23.82 million barrels in the week to June 12, Enterprise Singapore data showed on Thursday.
The June/July time-spread for 380-cst narrowed by 25 cents to $5 a tonne on Wednesday.
The June180 cst crack has dropped to – $ 2.40 / bbl with the visco spread at $ 1.80 /bbl.
The July180 cst crack is at – $ 2.00 / bbl with the visco spread at $ 1.45 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
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.