Crude Oil
Oil prices jumped another 4% yesterday in sync with the stock markets as Trump appeared to make way for smooth transition.
Brents future rose $3.66 to settle at $47.86 a barrel. WTI January crude futures rose $2.49 to $44.91 per barrel.
The contracts closed at their highest since early March on Tuesday, after a three-day rally pushed prices up around 8%.
Eni declared force majeure on exports of Nigerian Brass River crude oil following pipeline explosions in Bayelsa state, the company said on Tuesday. Eni repair and clean-up is ongoing and full production is likely to return within a week.
An uneven oil demand recovery across different regions and product types will see oil demand climb by 6.3 MB/D YoY in 2021, but demand will still be 2.4 MB/D below pre-pandemic levels, according to the latest forecast by S&P Global Platts Analytics.
api data
The API data was decidedly bearish with both crude and gasoline builds far larger than expected and a minor distillate draw. We shall see the DOE data tomorrow.
covid 19
At a global level, the death toll from the COVID-19 virus rose to 1,413,793 (+11,713 DoD) yesterday. The total number of active cases rose by around 180,000 DoD to 17.13 million. (Click here for details).
Naphtha
Asia’s naphtha crack fell to a 1-1/2-week low of $50.10 a tonne on Tuesday due to stubborn high supplies after briefly reaching a three-session high in the previous day.
Overall, South Korea’s naphtha import for the first 10 months of this year was marginally higher versus the same period last year.
The December crack is lower at – $1.05 /bbl.
Gasoline
Asia’s gasoline crack was at a two-session high of $1.43 a barrel but this was 45% lower versus a month ago as demand recovery has been slow.
The December crack is higher at $2.25 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Asia’s benchmark 10ppm diesel crack hit a three-month high of $5.73 a barrel on Tuesday, tracking crude gains.
Vietnam plans to extend a 30% reduction in environment tax on jet fuel by one year until the end of 2021 to help local airlines weather the impact of the COVID-19 pandemic.
Air passenger numbers are set to have weakened by almost 61% YoY in 2020 to 1.8 billion, similar to 2003 levels, the IATA said on Tuesday. However, passenger numbers are expected to grow again in 2021 to around 2.8 billion, it said.
The December crack for 500 ppm Gasoil is steady at $4.35 /bbl with the 10 ppm crack at $ 5.15 / bbl. The regrade is at -$ 1.35 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Asia’s 0.5% VLSFO held largely steady on Tuesday, but shrinking inventories and expectations of limited refinery output and arbitrage supplies of the fuel kept market outlooks skewed towards the bullish side.
The December crack for 180 cst FO is lower at -$0.85 /bbl with the visco spread at $0.70 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Hedge Recommendations
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.
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.