Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil prices recovered a substantial portion of Thursday’s losses as markets continued to stay upbeat about demand recovery. Friday’s rebound in oil was helped by short-covering on the previous day’s activity and a second day of broad gains on Wall Street after three prior days of carnage.

Brent crude hovered at $68.68 by 2:45 PM ET (18:45 GMT), up $1.63, or 2.4%, on the day. Brent dropped 3.3% in the previous session, its most since April 5. For the week, the global crude benchmark showed a gain of 0.6%, adding to last week’s 1.5% advance and the prior week’s 1.7% rise.

WTI crude futures settled at $65.37, up $1.55, or 2.4%. The rally helped offset a chunk of Thursday’s 3.4% drop. For the week, the U.S. crude benchmark gained 0.7%, adding to last week’s 2.1% advance and the prior week’s 2.3% rise.

The Suez Canal Authority (SCA) has started dredging work to extend a second lane that allows for two-way traffic in a southern section of the canal near to where a giant container ship got stuck for six days in Mar’21.

US energy firms added 8 oil rigs to total 352 (+594 YoY), the highest since Apr’20, according to Baker Hughes, as higher oil prices prompted some drillers to return to the wellpad.


At a global level, the death toll from the COVID-19 virus rose to 3.39 Million (+9,858 DoD) yesterday. The total number of active cases rose fell by around 220,000 DoD to 17.00 million. (Click here for details).

Naphtha markets held steady, underpinned by robust petrochemical demand.

The Naphtha crack to Brent settled at $94.30 /MT on Wednesday, $ 2.00, or 2.08% lower than the previous trading day.

The June crack has slipped into negative territory at -$ 0.10 /bbl

Asia’s gasoline crack slipped under $5 a barrel to its lowest in two months on Friday after U.S. prices of the motor fuel eased on the resumption of the nation’s top fuel pipeline.

In Asia, petrol demand has also been hit by expanding lockdown measures in countries such as India, Japan and southeast Asian nations amid rising COVID-19 cases.

The gasoline crack in Singapore tanked to $4.54 per barrel on Friday. This was $ 1.85, or 28.95% lower than the previous session.

The June crack is lower at $7.30 /bbl

Click Here for a graphical depiction of Global Gasoline stocks by region.

Cash differentials for gasoil with 10 ppm sulphur content flipped to a premium of 10 cents per barrel on Friday, supported by firmer deals in the physical trade window. They were at a discount of 3 cents per barrel to Singapore quotes on Wednesday.

Singapore’s middle distillate inventories rose 3.6% to a nine-week high of 13.9 million barrels in the week to May 11, according to Enterprise Singapore data.

Cash differentials for jet fuel rose 1 cent to a premium of 4 cents a barrel to Singapore quotes on Friday.

The June crack for 500 ppm Gasoil is lower at $7.00 /bbl with the 10 ppm crack at $ 8.30 /bbl. The regrade is at -$ 0.85 /bbl. 

Click Here for a graphical depiction of Global Distillate stocks by region.

Asia’s front-month crack for 0.5% very low-sulphur fuel oil (VLSFO) dropped on Friday, slumping to their weakest level in more than six weeks, weighed down by lacklustre demand and plentiful supplies.

The front-month VLSFO crack fell to $11.30 per barrel against Dubai crude during Asian trade on Tuesday, the lowest since March 31. The cracks dropped 11.9% this week, their steepest weekly decline since August last year.

Cash differentials for Asia’s 0.5% VLSFO were at a discount of $2.37 a tonne to Singapore quotes, compared with minus $2.12 per tonne on Wednesday.

Asia’s cash discount for 380-cst high sulphur fuel oil (HSFO) widened to $1 per tonne to Singapore quotes on Friday, hurt by two weaker deals in the physical trade window. 

The June crack for 180 cst FO is lower at  -$6.30 /bbl with the visco spread at $0.85 /bbl.

Click Here for a graphical depiction of Fuel Oil stocks by region.

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 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.

Disclaimer : All the views are the author’s personal views. These do not constitute an advice to buy or sell any commodity

Leave a Comment