Crude Oil
Oil prices fell more than 1% on Monday after more poor Chinese economic figures fanned fears of lower worldwide oil demand. Brent crude futures lost $1.07 to settle at $60.94 a barrel. WTI crude futures fell 58 cents to settle at $51.93 a barrel.
China trade war and disappointing economic data. China’s industrial output growth unexpectedly slowed to a more than 17 year low, data from the National Bureau of Statistics showed on Friday. It grew 5.0% in May from a year earlier, missing analysts’ expectations of 5.5% and well below April’s 5.4%.
Naphtha
Asia’s naphtha crack eased to $3.40 a tonne on Monday versus $3.45 a tonne on June 14.
Naphtha supplies were still ample although the attack on a ship carrying 75,000 tonnes of the fuel bound for Taiwanese buyer CPC from Ruwais last week had raised concerns on lifting cargoes from the Gulf.
Insurance costs for ships sailing through the Middle East for instance have increased by at least 10% after attacks on two tankers in the Gulf of Oman on Thursday, with the potential for costs to rise further as regional tensions escalate.
The attacks had also caused oil tanker owners DHT Holdings and Heidmar to suspend new bookings to the Mid-East Gulf.
The July crack is higher at -$6.45 /bbl
Gasoline
Asia’s gasoline crack fell by nearly 36.4 percent to more than a two-week low of $1.82 a barrel on ample supplies.
Sales of gasoline, or petrol, in India however rose by 11.32% to 2.73 million tonnes in May as the narrowing price gap with diesel is pushing motorists to opt for petrol-driven vehicles.
The July crack is lower at $ 4.50 / bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Asia’s 10ppm gasoil margin held above $15 a barrel for the second straight session on Monday supported by sporadic demand. Diesel domestic sales in India rose 2.84% to 7.78 million tonnes in May.
Looking ahead, demand for gasoil in the marine sector is expected to rise around 200,000 barrels per day (bpd) year on year in 2019 and 900,000 bpd in 2020 due to new fuel regulations in the shipping industry.
Japan’s top refiner JXTG Nippon Oil & Energy Corp has shut the 145,000 bpd crude unit at its Sendai refinery on June 15 for scheduled maintenance which would last until early August.
Singapore’s overall refining margins fell below $3 a barrel on Monday to the lowest since May 31 as the impact of weak light distillates margins outweighed stable middle distillates cracks.
The July crack for 500 ppm Gasoil is lower at $ 14.45 /bbl with the 10 ppm crack at $ 15.15 / bbl. The regrade is at +$ 0.30 /bbl
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Asia’s front month 380 cst high sulphur fuel oil (HSFO) crack to Dubai crude rebounded on Monday after hitting a more than two week low on Friday, as benchmark crude oil prices fell.
The July 380 cst HSFO crack on Monday was at $2.98 a barrel below Dubai crude oil prices, up from minus $3.14 a barrel on Friday its widest discount since May 30.
In a sign of changing fuel standards ahead of new rules from 2020, at least two Asian companies have switched to selling some of their low sulphur products against the newly formed 0.5% marine fuel cargo price assessments provided by S&P Global Platts.
The July180 cst crack is lower at – $ 1.95 / bbl with the visco spread at $ 1.55 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
No Fresh action for today.
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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.