20 Feb 2017
oil-barrel

Crude Oil

Crude Prices ended marginally positive yesterday after continuing to trade in the negative zone for most of the day.  Brent fell by $ 10cents to close at $55.65 /bbl,  WTI rose by 25 cents to settle at $ 53.36 /bbl.

 

This is reflective of the ‘Monkey with his hand in the nut jar syndrome’. Nobody wants to be caught short should there actually be an impact of the production cut on stocks even though it is getting increasingly harder to believe it.  With the US markets shut today for the President’s day holiday, funds feared a rise to the upside rather than to the downside.
In other weekly data, funds continued to increase their long positions. This confirms that the prices have been shored up by funds who are either convinced that prices will zoom up, or who are defending their positions.

The Baker Hughes rig count continued to rise, a  signal that supplies from the US are only going to increase.

Technical Analysis

 

 

 

 

 

 

 

 

The daily candlestick chart continues to show a series of ‘spinning top’ candles, an indication that the market is uncertain about direction. The MACD is slowly moving towards a crossover on the downside,  which is regarded as a signal to sell.

The weekly chart suggests that a close below 55 is needed to reverse the uptrend.

 

Naphtha

Naphtha prices tanked yesterday following reports of a huge rise in gasoline stocks in the ARA region.  While the Naphtha fundamentals per se still hold strong for petchem operations, the losses would reflect the reduction in demand for gasoline blending. The March MOPJ crack is valued at $ 1.80 / bbl value.  The Singapore crack for March is valued at around $ 0.70 /bbl

Gasoline 

The gasoline crack was further buffeted by the increase in Gasoline stocks in the ARA region of the order of 23% to 1.21 Million Tons.  The March crack is currently valued $ 12.25/bbl.

Middle Distillates

Gasoil prices firmed up marginally as traders eye refineries entering into turn around.  The demand for jet though, continues to lag severely.

The March crack is valued at  $12.5 / bbl with the regrade at -$0.50 /bbl.

Fuel Oil

Fuel Oil prices too continued to ease as the market seems to be searching for a new equilibrium. March is valued   -$ 3.3/bbl and April around -$ 3.7 /bbl.

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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