Oil prices rose to a one-week high on Tuesday after a move by the United States and other consumer nations to release tens of millions of barrels of oil from reserves to try to cool the market fell short of some expectations.
Brent crude futures rose $2.61, or 3.3%, to settle at $82.31 per barrel. WTI crude rose $1.75, or 2.3%, to settle at $78.50 per barrel.
The United States said on Tuesday it would release millions of barrels of oil from strategic reserves in coordination with China, India, South Korea, Japan and Britain, to try to cool prices after OPEC+ producers repeatedly ignored calls for more crude. But analysts said the effect on prices was likely to be short-lived after years of declining investment and a strong global recovery from the COVID-19 pandemic.
api data
The build in crude would have caught investors by surprise today. We shall, however, await official data later this evening.
At a global level, the death toll from the COVID-19 virus rose to 5.18 Million (+8,110 DoD) yesterday. The total number of active cases rose by 110,000 DoD to 19.50 million. (Click here for details).
Asia’s naphtha crack gained on Tuesday after crude oil prices dropped more than 1% ahead of the expected release of U.S. crude reserves. The refining profit margin rose to $151.20 a tonne from $149.78 in the previous session. The upside to margins was capped by slowing supplies.
Overall naphtha flows into Asia for November stood at 6.5 million metric tonnes (mt), down from October’s revised total of 6.7 million mt, assessments by Refinitiv Oil Research showed.
The December crack is lower at $ 2.85 /bbl.
The gasoline crack in the region inched lower as major economies India and Japan worked on oil-reserve release with the United States to ease prices.
The crack slipped to $7.75 a barrel from $7.99 in the prior session. But hopes of a decline in U.S. inventories limited losses.
The December crack is higher at $10.25/ bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Asia’s cash premiums for benchmark 10 ppm gasoil and jet fuel cargoes edged higher on Tuesday on continued signs of improving demand and tight regional inventories.
Cash differentials for gasoil with 10 ppm sulphur content rose by 2 cents to a premium of 46 cents per barrel to Singapore quotes.
“The global diesel market is headed for several weeks of volatility as it seeks direction ahead of peak heating demand in Q1 2022,” Energy Aspects said in a note to clients on Monday. A mild start to winter and rising COVID-19 cases in Europe pose downside risks to demand, but a cold snap could boost Atlantic basin import requirements by between 1.6 million tonnes and 1.8 million tonnes. “Despite rising runs east of Suez, Indian barrels are swinging east on growing regional demand and muted Chinese exports, potentially slowing westbound flows into year-end,” it said.
Asia’s cash premiums for jet fuel edged higher on Monday, lifted by stronger buying interest in the physical market. Cash differentials for Jet improved by 7 cent to a premium of 12 cents over Singapore quotes. This is a one week high.
The December crack for 500 ppm Gasoil is lower at $10.00 /bbl with the 10 ppm crack at $ 11.30 /bbl. The regrade is at -$ 0.30 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Asia’s 0.5% very low-sulphur fuel oil (VLSFO) market complex extended gains on Tuesday, boosted by a tight near-term supply outlook amid limited refinery output and a lack of blendstock materials.
The front-month VLSFO time spread climbed to a fresh 21-month high of $11.25 a tonne while the front-month crack edged up to a three-session high of $13.63 a barrel above Dubai crude, Refinitiv data in Eikon showed.
In the physical market, the VLSFO cash premium climbed 41 cents from the previous session to a near two-year high of $9.92 a tonne above Singapore quotes on Tuesday. The cash differential was at a $2.72 per tonne premium at the start of the month.
The December crack for 180 cst FO is lower at -$7.60 /bbl with the visco spread at $1.60 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
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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.