Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil prices fell about 3% to below $80 a barrel on Friday as surging COVID-19 cases in Europe threatened to slow the economic recovery while investors also weighed a potential release of crude reserves by major economies to cool prices.

Brent crude futures for January fell $2.35, or 2.9%, to settle at $78.89 a barrel. For the week, the global oil benchmark fell 4%, bringing its combined losses over the past four weeks to 8%, after an 18% rally over seven weeks in a row.

WTI crude futures settled down $2.91, or 3.2%, at 75.94 per barrel. For the week, WTI fell 5.8%, bringing its combined losses over the past four weeks to 9.3%, after an 18% rally over nine straight weeks.

“The fear of the unknown is weighing on market sentiment,” said Phil Flynn, senior analyst at Price Futures in Chicago. “The worry is that we will get some sort of coordinated release during the Thanksgiving Holiday next week, when volumes are typically low and dramatic moves have occurred.”

At a global level, the death toll from the COVID-19 virus rose to 5.16 Million (+4,108 DoD) yesterday. The total number of active cases rose by 50,000 DoD to 19.93 million. (Click here for details).

Austria became the first country in western Europe to reimpose a full coronavirus lockdown this autumn to tackle a new wave of COVID-19 infections across the region.

Asia’s naphtha crack rose to $154.65 a tonne from $152.53 in the previous session.

ARA naphtha inventories rose to 263,000 tonnes, from 193,000 tonnes in the prior week.

The December crack is lower at $ 3.30 /bbl.

Asia’s gasoline crack  inched higher to $9.83 a barrel from $9.72.

ARA refining and storage area rose by 2.8% to 869 KT in the week to Thursday, data from Dutch consultancy Insights Global showed.

The December crack is lower at $9.30 / bbl

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

Asia’s cash premiums for 10 ppm gasoil slipped for a sixth consecutive session on Friday, posting their steepest weekly decline in more than three months, weighed down by ample supplies from India and South Korea.

Cash differentials for gasoil with 10 ppm sulphur content  plunged to 45 cents per barrel to Singapore quotes, their lowest since Oct. 14. The differentials, which were at a 49-cent premium on Thursday, has fallen about 38% this week.

Asian refining margins for 10 ppm gasoil dropped to $11.98 per barrel over Dubai crude during Asian trading hours. They were at $12.20 per barrel a day earlier, and have shed 8% this week.

India’s diesel exports this month are expected to close above October’s total of 2.07 million tonnes, while exports from South Korea would likely close around last month’s total of 2.32 million tonnes, Refinitiv Oil Research assessments showed.

Gasoil stocks held independently in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub rose 1.7% to 1.9 million tonnes in the week ended Nov. 18, according to Dutch consultancy Insights.

Cash differentials for Jet improved by a cent to a premium of 11 cents over Singapore quotes.

ARA jet fuel inventories dropped 1.8% this week to 835,000 tonnes.

The December crack for 500 ppm Gasoil has collapsed to $9.55 /bbl with the 10 ppm crack at $ 10.80 /bbl. The regrade is at -$ 0.80 /bbl. 

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

Boosted by concerns of tightening supply and firm demand, Asia’s 0.5% very low-sulphur fuel oil (VLSFO) cash differential extended gains on Friday amid strong deal values for cargoes of the fuel in the Singapore window.

The front-month HiLo sulphur price spread, the difference between front-month 0.5% very low-sulphur fuel oil (VLSFO) and 380-cst high-sulphur fuel oil (HSFO) swaps, climbed to $140.75 a tonne on Thursday, up by $5.25 from the previous session, Refinitiv data showed.

Onshore fuel oil stocks fell by 393,000 barrels, or about 62,000 tonnes, to a six-week low of 21.36 million barrels, or 3.36 million tonnes, Enterprise Singapore data showed. The residual fuel stocks were 3% lower from year-ago levels and below the 2021 weekly average of 22.7 million barrels.

The December crack for 180 cst FO is higher at  -$6.40 /bbl with the visco spread at $1.35 /bbl.

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

No Fresh trades 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.

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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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