Crude Oil
Oil prices fell more than 3% on Monday, extending last week’s losses as coronavirus cases continued to surge in the United States and Europe, while Libya’s rebound in crude production raised fears of oversupply.
Brent crude futures fell $ 1.31 to settle at $40.46 a barrel. WTI crude futures fell $ 1.29 to $38.56 per barrel.
The United States reported its highest number yet of new coronavirus infections in two days through Saturday, while in France new cases hit a record of more than 50,000 on Sunday.
Oil producers on Monday shut 16%, or 294 KB/D of oil and 6% of natural gas output, or 162.57 mmcfd, in the US Gulf of Mexico as the 27th named storm of the season strengthened into a hurricane and took aim at the US Gulf Coast.
Hedge funds purchased crude futures and options at the fastest rate in six months, buying the equivalent of 55 MB in the week to 22 Oct’20, as portfolio managers became more confident OPEC+ would postpone scheduled output increases until demand is stronger.
covid 19
At a global level, the death toll from the COVID-19 virus rose to 1,164,236 (+5,110 DoD) yesterday. The total number of active cases rose by around 160,000 over the weekend 10.43 million. (Click here for details).
Naphtha
Asia’s naphtha inter-month spread persisted at a six-month low due to ample supplies while spot demand was mostly muted on Monday following a string of purchases last week.
The contango on front-month open-specification naphtha for first-half December rose to $5.50 a tonne versus $4.50 in the previous session, a sign that heavy supplies persisted for prompt delivery.
The November crack is higher at $ 1.90 /bbl
Gasoline
No fresh news on the gasoline markets.
The November crack is higher at $ 2.90 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Asia’s benchmark 10ppm diesel crack was near a one-month low of below $2.50 a barrel on Monday on the back of stubborn ample supplies.
Chinese diesel exports rose further in September to 1.19 million tonnes versus 1.09 million tonnes in August as companies ramped up overseas shipments to reduce overflowing domestic stocks after months of hefty refinery processing.
The November crack for 500 ppm Gasoil is steady at $2.05 /bbl with the 10 ppm crack at $ 2.85 / bbl. The regrade is at -$ 0.70 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Cash premiums for cargoes of Asia’s 180-cst HSFO fell on Monday, retreating from an eight-month high hit in the previous session.
180-cst HSFO cash premiums fell to $7.61 per tonne to Singapore quotes, down from $8.37 per tonne in the previous session.
One 20,000-tonne cargo trade was reported in the Singapore window at a $7 per tonne premium to Singapore quotes, down from a premium of $11 per tonne paid for a similar cargo on Friday.
The November crack for 180 cst FO is steady at $0.20 /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 action 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.