Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Crude oil prices rose on Monday as fresh economic data from around the world supported expectations of a sustained recovery in demand – despite jitters about the spread of a new variant of the Covid-19 virus.

Brent futures finished Monday’s official session at $69.46 per barrel, up 75 cents, or 1.1%. WTI crude futures settled up 90 cents, 1.4%, at $66.27 per barrel.

The production level of PDVSA and its international partners in the Orinoco Belt increased to 342 KB/D for the first two weeks of May, 104 KB/D higher YoY, according to an internal technical report seen by S&P Global Platts.

Iran will ship the first cargo of crude oil from its new terminal at Jask on the Oman Sea Coast in Jun’21, following completion of a key oil export pipeline that bypasses the Strait of Hormuz, its oil minister said 17 May’21.

China’s crude oil throughput rose 7.5% YoY in Apr’21 to 57.9 MMT (~14.09 MMB/D), but remained off the peak seen in 4Q’20 as several state-run oil refineries carried out maintenance amid thin margins and high fuel products stocks.

Japan’s economy shrank more than expected in 1Q’21, down 5.1%, as the slow vaccine rollout and a resurgence in infections hit consumption, reinforcing expectations the country will lag major trading partners in emerging from the pandemic.

Hedge funds sold the equivalent of 31 MMB in the week to 11 May’21, as oil prices neared the top of recent trading ranges and the cyberattack on the Colonial fuel pipeline looked set to cut crude processing and diesel output.


At a global level, the death toll from the COVID-19 virus rose to 3.40 Million (+10,733 DoD) yesterday. The total number of active cases rose fell by around 320,000 DoD to 16.68 million. (Click here for details).

Asia’s naphtha crack was at $90.32 per tonne on Monday, compared with $94.30 a tonne on Friday.


The June crack has is lower at -$ 0.25 /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 higher at $7.40 /bbl

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

Asia’s cash differentials for 10 ppm gasoil rose on Monday to their highest level in more than nine months, buoyed by firmer buying interests for physical cargoes.

Cash differentials for gasoil with 10 ppm sulphur content, which flipped into a positive territory last week, rose to a premium of 22 cents per barrel to Singapore quotes. They were at a 10-cent premium on Friday.

The front-month time spread for 10 ppm gasoil widened its backwardation to trade at 10 cents per barrel on Monday.

Domestic sales of gasoline and diesel by Indian state refiners over 1-15 May’21 fell by about 20% YoY, while jet fuel consumption slumped by nearly 38% YoY, the data compiled by the state refiners showed.

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

Global scheduled airline capacity for the week starting 17 May’21 increased 3.2% WoW to 64.1 million seats, as a jump in Western Europe offset a slump in South Asia, according to OAG. Global seat capacity was at 60% of Jan’20 levels.

The June crack for 500 ppm Gasoil is higher at $7.05 /bbl with the 10 ppm crack at $ 8.35 /bbl. The regrade is at -$ 0.90 /bbl. 

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

Cash differentials for cargoes of Asia’s 0.5% very low-sulphur fuel oil (VLSFO) and 380-cst high-sulphur fuel oil (HSFO) dropped to new lows as ample supplies and sluggish demand weighed on the residual fuel markets.

The VLSFO cash discount was at its widest in more than eight-months at $2.55 a tonne to Singapore quotes while the 380-cst HSFO differential was at a nearly 11-month low of minus $1.88 per tonne.

The June crack for 180 cst FO is lower at  -$7.25 /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

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