Crude Oil
Markets have been very thin as most shops are preparing to close their books for the year. On Friday, Brent settled at $ 55.16/bbl, up 11 cents on the day while WTI gained $ 0.07 / bbl to settle at $ 53.02 / bbl.
All the producers are saying and showing the right things in preparation for the cut in production starting in January next year. The extent of adherence remains to be seen.
On the bearish side, Libya’s production is expected to increase by around 300 kbpd next month. Additionally, the US is expected to sell around 8 million barrels of crude from its SPR (say 250 kbpd) in the month of January.
Further, the progress of the winter and the consumption of petroleum products needs to be seen to properly judge the impact of the cut in crude supplies.
Naphtha
The Naphtha January crack should be showing a positive value in the market. However, with the traditional lack of liquidity in Singapore Naphtha paper combined with year end thin markets, it is unlikely that refiners will get an opportunity to sell into this rally.
Naphtha appears to be deriving most of its strength from the gasoline market, hence
Gasoline
The gasoline market once again has risen showing a value in excess of $ 13.2 / bbl in January. However, we may not find that aggressive a bid in the market due to its thinnes
Middle Distillates
The gasoil crack for January is the same to marginally higher at $ 11.3 /bbl with the regrade steady at $ 1.40 /bbl.
Fuel Oil
Fuel Oil prices appeared to be slightly easier with the crack nearly unchanged at $-1.35 /bbl for January.
Traders are going to be keeping an eagle eye on volumes of arbitrage cargos coming in. We are of the opinion that current there appears to be a slight bias to the downside.
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.