Crude prices tumbled more than 2% Friday for their biggest slump since January on worries that refineries could be the next casualties from the Texas storms — resulting in a pile-up of crude stocks.
Brent settled at $62.91, down $1.02, or 1.6%. For the week, it gained 0.8%.
WTI crude settled settled settled at $59.26, down $1.27, or 2.1%. For the week, WTI dropped just 0.5%.
Crude prices were also pressured Friday by reassurances from Iran’s foreign minister that the Islamic Republic will “immediately reverse” its nuclear program once U.S. sanctions are lifted.
India’s crude oil processing registered its second straight year-on-year gain in January, while hitting a more than one-year high, as fuel demand improved on the back of a gradual increase in industrial and economic activity. Indian refiners operated at an average rate of 102.8% in January, slightly up from 102.6% in the same month last year and above December’s 99.1%, the government data showed.
US energy firms cut 1 oil rig in the week to 19 Feb’21 to total 305 (-374 YoY). The decline in the oil rig count follows 12 weeks of gains, which was the longest streak of increases since Jun’17, according to Baker Hughes.
Money managers raised their net long US crude futures and options positions by 16,219 contracts to total 399,935 in the week to 16 Feb’21 to the highest since Jun’20, the US CFTC said on Friday.
At a global level, the death toll from the COVID-19 virus rose to 2,477,790 (+6,293 DoD) yesterday. The total number of active cases fell by around 50,000 DoD to 22.16 million. (Click here for details)
Asia’s naphtha crack rose to $108.75 per tonne on Friday, up from $97.28 per tonne a day earlier, presumably on the back of an upsurge in the gasoline crack.
The March crack is higher at $2.80 /bbl
Asia’s gasoline crack surged to a more than four-month high on Friday, buoyed by expectations for tighter supplies in the near term as refiners in north Asia head into the spring turnaround season.
The crack climbed on Friday to $5.30 per barrel, a level not seen since Oct. 1. The crack was at $4.71 per barrel a day earlier. A preference towards opting for personal vehicles in order to avoid public transportation during the pandemic is supporting gasoline demand in some markets, market watchers said.
Gasoline stocks held independently in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub rose 0.6% to 1.3 million tonnes in the week to Feb. 18, data from Dutch consultancy Insights Global showed.
The March crack is higher at $7.75 /bbl.
Click Here for a graphical depiction of Global Gasoline stocks by region.
Cash differentials for gasoil with 10 ppm sulphur content returned to a premium of 3 cents a barrel on Friday, compared with a 1-cent discount on the previous day.
Gasoil stocks held independently in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub fell 3.8% to 2.6 million tonnes in the week to Feb. 18, data from Dutch consultancy Insights Global showed. The data showed ARA jet fuel inventories dropped 5% to 934,000 tonnes.
Cash discounts for jet fuel widened to 25 cents per barrel to Singapore quotes on Friday, hurt by weaker buying interests in the physical trade window. They were at a discount of 17 cents per barrel a day earlier.
The March crack for 500 ppm Gasoil is higher at $7.15 /bbl with the 10 ppm crack at $ 8.35 / bbl. The regrade is at -$ 1.45 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Asia’s front-month price differentials between 0.5% very low-sulphur fuel oil (VLSFO) and high-sulphur fuel oil (HSFO), also known as the HiLo or sulphur spread, climbed further to set a new high on Friday.
The front-month HiLo spread climbed to $123.25 a tonne on Friday, up from $122.75 in the previous session and its highest since March 11, according to Refinitiv data in Eikon.
The front-month HiLo spread climbed to $122.75 a tonne on Thursday, up from $119.50 in the previous session and its highest since March 11, according to Refinitiv data in Eikon.
VLSFO cash differentials slipped by 91 cents/ MT to $2.87 /MT.
180 cSt HSFO cash differentials were up 17 cents at $1.18 / MT while the 380 cSt HSFO differentials gained 19 cents to a log a premium of $0.23 /MT.
Fuel oil stocks in the ARA refining and storage slipped by 19,000 tonnes to a two-week low of 1.658 million tonnes in the week ended Feb. 18, data from Dutch consultancy Insights Global (IG) showed.
The March crack for 180 cst FO is unchanged at -$3.60 /bbl with the visco spread at $0.70 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
We will lay on a trade in March Jap-Nap-Dubai at current levels of $2.80 / bbl. We will also consider doing the same in April should levels cross $2.00 / 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.