Oil prices rose about 1% on Friday and posted a third consecutive weekly rise, buoyed by successful COVID-19 vaccine trials.
Brents future rose 76 cents to settle at $44.20 a barrel. WTI January crude futures rose 52 cents to $42.42 per barrel.
Both benchmarks gained about 5% this week.
India plans to nearly double its oil refining capacity in the next five years, earlier than expected. The country’s energy minister was quoted in Jun’20 saying total refining capacity could jump to 450-500 MMT in 10 years from the current 250 MMT.
Singapore’s economy contracted less than initially estimated in Q3’20, with GDP falling 5.8% YoY, instead of the expected 7% YoY drop, measures and authorities expect the city-state to bounce back to growth next year from its worst recession.
US energy firms cut 5 oil rigs in the week to 20 Nov’20 to total 231 (-440 YoY), the first cut in 10 weeks, according to Baker Hughes, even as producers return to the wellpad with crude prices mostly trading over $40/bbl since mid-Jun’20.
Money managers raised their net long US crude futures and options positions by 3,100 contracts to total 277,080 in the week to 17 Nov’20, the US CFTC said on Friday.
At a global level, the death toll from the COVID-19 virus rose to 1,393,727 (+7,409 DoD) yesterday. The total number of active cases rose by around 680,000 over the weekend to 16.82 million. (Click here for details).
Prospects for effective COVID-19 vaccines have bolstered oil markets this week. Pfizer Inc said it will apply to U.S. health regulators on Friday for emergency use authoritization of its vaccine, the first such application in a major step toward providing protection against the new coronavirus.
Asia’s naphtha crack ended the week at a five-session low of $52.23 a tonne as excess supplies persisted.
The crack value reached a 1-1/2-week high on Wednesday following some interest on spot and term cargoes.
The December crack is lower at – $0.55 /bbl.
No fresh news on Asia markets.
Gasoline inventories at ARA rose nearly 7.4% to reach a six-week high of almost 1.33 million tonnes in the week to Thursday.
The December crack is lower at $1.60 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Asia’s cash differentials for 10 ppm gasoil gained on Friday backed by a firmer deal in the physical market. They were at a discount of 13 cents a barrel to Singapore quotes on Friday, compared with a 14-cent discount on Thursday.
The front-month time spread for 10 ppm gasoil, which has remained in a contango structure since early August, traded at a discount of 14 cents per barrel on Friday.
The gasoil EFS traded around minus $3 per tonne on Friday, making it unworkable for arbitrage shipments.
The December crack for 500 ppm Gasoil is lower at $4.10 /bbl with the 10 ppm crack at $ 4.90 / bbl. The regrade is at -$ 1.15 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Asia’s 0.5% VLSFO crack climbed on Friday, posting its biggest weekly gain in seven weeks, supported by firm demand and limited supplies. The front-month VLSFO crack rose to $10.67 per barrel against Dubai crude during Asian trading hours, from $10.44 per barrel on Thursday. The VLSFO cracks have jumped 9.5% this week, their strongest weekly rise since Oct. 2.
Cash premium for Asia’s 0.5% VLSFO was at $2.39 a tonne to Singapore quotes on Friday, compared with $2.23 per tonne on Thursday.
The Dec/Jan time spread remained unchanged for a fourth consecutive session to trade at a premium of $2.50 per tonne on Friday.
Asia’s cash premium for 380-cst HSFO rose by 8 cents to $7.88 per tonne to Singapore quotes on Friday.
The 380-cst high-sulphur fuel oil HSFO barge crack for December was at a discount of $4.37 a barrel to Brent on Friday, compared with minus $4.55 a barrel on Thursday.
The December crack for 180 cst FO is steady at -$0.20 /bbl with the visco spread at $0.80 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
No fresh activity 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.