Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil prices fell 2% on Monday as investors grew more risk averse, which hurt stock markets and boosted the U.S. dollar, making oil more expensive for holders of other currencies.

fell $1.42, or 1.9%, to settle at $73.92 a barrel after sinking to a session low of $73.52. U.S. West Texas Intermediate (WTI) declined $1.68, or 2.3%, to end at $70.29 after falling to as low as $69.86.

On Hurricane Ida-related outages, the Bureau of Safety and Environmental Enforcement reported that less than 19% of US Gulf oil production remained shut in versus last week’s levels of 25%.

Hedge funds purchased crude after disruption to offshore production in the Gulf of Mexico lasted longer than expected, extending a drawdown of already-tight petroleum inventories. In the week to Sept. 14, hedge funds and other money managers purchased the equivalent of 41 million barrels in the six most important petroleum futures and options contracts, according to exchange and regulatory data.

The combined position across all six contracts climbed to 793 million barrels (72nd percentile for all weeks since 2013), up from a recent low of 677 million (59th percentile) on Aug. 24. The ratio of bullish long positions to bearish short ones has risen to 5.68:1 (77th percentile) from 4.25:1 (58th percentile) on Aug. 24.

At a global level, the death toll from the COVID-19 virus rose to 4.71 Million (+5,748 DoD) yesterday. The total number of active cases fell by 30,000 DoD to 18.68 million. (Click here for details).

Asian naphtha crack gained for a fourth consecutive session, hitting a five-week high. The crack rose to $139.15 a tonne, highest since mid-August, from $137.50 in the last session.

The October crack is unchanged at $4.70 / bbl.

Asia’s gasoline crack fell below $7 a barrel on Monday, after a week of gains, while demand for the higher 95-octane grade of the fuel at the trading window stayed firm. 

The crack slipped to $6.87 per barrel from $7.26 on Friday.

The October crack is lower at $9.00 / bbl.


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

Asian refining margins for 10 ppm gasoil dipped on Monday, but stayed within close sight of a multi-month high touched in the previous session, while cash premiums for the industrial fuel grade rose on firmer buying interests for physical cargoes.

Cash differentials for gasoil with 10 ppm sulphur were at a premium of37 cents per barrel to Singapore quotes on Monday, compared with a 34-cent premium on Friday.

Refining margins, also known as cracks, for 10 ppm gasoil slipped to $10.47 per barrel over Dubai crude during Asian trading hours, down 4 cents from Friday, when it hit the highest since March-end last year.

Asia’s cash differentials for jet fuel were at a premium of 10 cents per barrel to Singapore quotes, compared with a premium of 4 cents a barrel on Friday.

Asian refining margins for jet fuel were at $7.74 per barrel over Dubai crude during Asian trading hours, compared with $7.82 per barrel at the end of last week.

The October crack for 500 ppm Gasoil is lower at $9.00 /bbl with the 10 ppm crack at $ 10.50 /bbl. The regrade is at -$ 1.05 /bbl. 

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

Asia’s front-month high-sulphur fuel oil (HSFO) viscosity spread, the price differential between 180-cst HSFO and 380-cst HSFO, hit a record high on Monday.

The front-month viscosity spread climbed to a record $25.25 per tonne on Monday, up from $20.50 in the previous session and the highest since records began in 2013, according to Refinitiv data in Eikon.

The October crack for 180 cst FO is higher at  -$0.95 /bbl with the visco spread at $2.85 /bbl.

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

No trades for now. We shall hedge 1Q Nap-Dubai rates over $3.75 / bbl. 

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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