Crude Oil

Oil prices were near flat on Tuesday, pressured by concerns over the impact on crude demand from the coronavirus outbreak in China. Brent futures rose  8 cents to settle at $57.75 a barrel. WTI crude futures were unchanged from Friday’s setted at $52.05 a barrel.

The Covid 19 virus is having a wider impact on financial markets. Asian shares fell and Wall Street also retreated after Apple Inc said it would miss quarterly revenue guidance due to slower iPhone production and weakened demand in China.

U.S. shale oil output is expected to rise by about 18,000 barrels per day (bpd) in March to a record 9.18 million bpd, driven by gains in the Permian Basin, data from the U.S. Energy Information Administration showed Tuesday.


Asia’s naphtha crack remained at a 4-1/2-month low for a second session on Tuesday at $59.28 a tonne, on muted trades after the value dropped 16% on the previous day.

The March crack has improved to – $ 2.55 / bbl. 


Asia’s gasoline crack fell for the third straight session and hit a 2-1/2-week low of $6.42 a barrel.

The March crack is higher at $8.00 /bbl

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


Cash premiums for 10 ppm gasoil were at 49 cents a barrel to Singapore quotes on Tuesday, up from 48 cents a barrel on Monday.

Cash discounts for jet fuel were at 13 cents per barrel to Singapore quotes on Tuesday, compared with a discount of 12 cents per barrel a day earlier. The front-month time spread for the aviation fuel in Singapore widened its contango by a cent on Tuesday to trade at a discount of 28 cents per barrel.

The March crack for 500 ppm Gasoil dropped further to $9.80 /bbl with the 10 ppm crack at $ 10.70 / bbl. The regrade is at   -$ 1.15 /bbl. 

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

Fuel Oil

Asia’s front-month time spread for 0.5% VLSFO market extended losses on Tuesday, with cash premiums, time-spreads and refining margins sinking to fresh lows amid limited trade activity. Demand for VLSFO bunkers has slowed in recent weeks as seasonal factors were compounded by slowing trade due to the coronavirus outbreak.

Asia’s front-month VLSFO crack to Brent crude fell to a more than three-month low of $14.49 a barrel on Tuesday, while the front-month time spread fell into deeper contango of minus $2.25 a tonne, a near three-month low.

Several Chinese independent refineries, or teapots, as the industry calls them, have snapped up crude supplies after prices slumped, betting that they are bottoming out and China’s demand could recover from a coronavirus outbreak in coming months.

The March 180 cst crack has dropped to -$ 8.85/ bbl with the visco spread at  $ 1.15 /bbl.

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

Hedge Recommendations

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.

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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