We apologize for the irregularity of publication over the last couple of weeks and promise to resume on a regular basis from today.
Crude Oil
Oil prices fell about 2% on Friday though hopes for a vaccine kept crude futures on track for a second straight weekly gain.
Brents future 75 cents to settle at $42.78 a barrel. WTI crude futures fell 99 cents to $40.13 per barrel.
For the week, both contracts notched gains of more than 8%.
Libyan oil production has now reached 1.215 MB/D, a Libyan oil source told Reuters on Friday, as the OPEC member’s oil industry recovers faster than expected.
China’s crude oil throughput rose 2.6% YoY in Oct’20 to hit a record high of 14.09 MB/D, as fuel demand firmed on strong holiday travel, according to data from the NBS on Monday.
US energy firms added 10 oil rigs in the week to 6 Nov’20 to total 236 (-438 YoY), according to Baker Hughes, as producers keep returning to the wellpad after crude prices held around $40/bbl from mid Jun’20-late Oct’20. This is the highest level since May.
covid 19
At a global level, the death toll from the COVID-19 virus rose to 1,324,025 (+6,613 DoD) yesterday. The total number of active cases rose by around 930,000 over the weekend to 15.35 million. (Click here for details).
Naphtha
Asia’s naphtha crack eased 2.3% to reach a fresh 5-1/2 month low of $44.80 a tonne on Friday.
Naphtha purchases have been brisk this week but the pace was slowed by the extended shutdowns of two crackers in South Korea due to fire.
The December crack is lower at – $0.50 /bbl.
Gasoline
Asia’s gasoline crack fell 18.5% to a 2-1/2 month low of $1.71 a barrel on ample supplies.
Gasoline stocks at ARA surged 15% in the week to Thursday to a three-week high of 1.2 million tonnes (about 10 million barrels).
The December crack is lower at $2.10 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Asia’s cash differentials for jet fuel dropped for a fourth consecutive session on Friday, while the prompt-month time spread for the aviation fuel in Singapore widened its contango structure.
Cash discounts for jet fuel were at 47 cents a barrel to Singapore quotes, the widest since Nov. 2. They were at a discount of 42 cents per barrel a day earlier.
The November/December time spread for jet fuel traded at a discount of 48 cents a barrel on Friday, compared with minus 34 cents on Thursday. The jet fuel market has found some support as demand for closely-related kerosene picked up ahead of winter months in Japan, which uses the fuel for residential heating during the cold months.
ARA gasoil inventories dropped 2.8% to 2.6 million tonnes. Compared with year-ago levels, gasoil inventories were up 5.1%. Jet fuel stocks held in ARA dropped 4.4% to 1.2 million tonnes in the week to Nov. 12.
The December crack for 500 ppm Gasoil is marginally lower at $3.65 /bbl with the 10 ppm crack at $ 4.45 / bbl. The regrade is at -$ 0.80 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Asia’s front-month crack for 0.5% VLSFO for December dropped to $9.74 per barrel against Dubai crude during Asian trading hours. The cracks, which hit a more than six-month high of $10.71 earlier in the week, were at $9.83 per barrel on Thursday. The VLSFO cracks, however, have gained 2.5% this week.
Cash differentials for Asia’s 0.5% VLSFO was at a premium of $1.06 a tonne to Singapore quotes on Friday, as against $1.14 per tonne a day earlier.
Backed by a firmer deal in the Singapore physical trade window, Asia’s cash premium for 380-cst HSFO) climbed to $6.91 per tonne to Singapore quotes on Friday, up from $6.83 per tonne on Thursday. The 380-cst HSFO barge crack for December was at a discount of $4.11 a barrel to Brent on Friday, compared with minus $4.45 a barrel on Thursday.
Fuel oil stocks held in ARA dipped 0.4% to 1.3 million tonnes in the week ended Nov. 12. Compared to this time last year, fuel oil inventories were 53.9% higher.
The front-month viscosity spread fell to $5.50 per tonne on Friday, down 25 cents from the previous session, and its lowest since Sept. 23.
The December crack for 180 cst FO is higher at -$0.10 /bbl with the visco spread at $0.90 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
No fresh activity 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 refinery.
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.