Oil prices edged up on Monday, supported by a strengthening equities market and news that the United States and Mexico agreed to overhaul the North American Free Trade Agreement (NAFTA). Brent crude rose 39 cents to settle at $76.21 a barrel. WTI crude futures gained 15 cents to close at $68.87 a barrel.
Members of an OPEC and non-OPEC monitoring committee found producers cut their July output by 9 percent more than called for in their output reduction pact. This compared with a compliance level of 120 percent for June and 147 percent for May, meaning participants have been steadily increasing production. OPEC and other producers led by Russia agreed in June to return to 100 percent compliance with oil output cuts that began in January 2017. This follows months of underproduction by Venezuela and other producers which cut output by 160 percent of the agreed target.
Sinopec announced higher throughput targets of 242 million mt for 2018, i.e. around 80% of its total capacity. The company also said its product exports have increased and plans to request for more quotas.
Total says it is “optimistic” on reaching a resolution on UK North Sea strikes, which so far have forced production to shutter in various facilities which handle about 70 kb/d of output.
Asia’s naphtha crack eased for a third straight session on Monday to hit a near six week low of $92.57 a tonne, while the front month price for first half October was on par with first half of November, reflecting weak fundamentals.
The September crack is lower at -$ 1.15 /bbl
Asia’s gasoline crack was near a three week low of $8.21 a barrel as supplies continued to seem abundant.
The September crack is lower at $ 8.90 /bbl
Click Here for a graphical depiction of Global Gasoline stocks by region.
Asia’s 10 ppm gasoil crack eased on higher oil prices on Monday to a two session low of $16.07 a barrel after touching a near three month high late last week. Asia’s jet fuel crack similarly was down to a two session low of about $15 a barrel. Despite robust demand for air travel, high oil prices have hurt airlines’ profits.
The September crack is higher at $ 15.50 / bbl with the 10 ppm crack at $ 16.30 /bbl. The regrade is lower at – $ 0.30 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Cash premiums for cargoes of Asia’s 180cst and 380cst high sulphur fuel oil narrowed on Monday amid a weaker deal value in the Singapore trading window. While Singapore fuel oil inventories hit their lowest in more than nine years in the previous week, arbitrage volumes into Singapore were expected to rebound soon, easing supply shortages that have persisted in the city state for most of summer.
The 380cst fuel oil cash premium slipped to a three session low of $5.65 a tonne to Singapore quotes on Monday, down from $6.13 per tonne on Friday.
Cash premiums of 180cst fuel oil slipped to a more than five week low of $4.22 a tonne to Singapore quotes on Monday.
The September180 cst crack is lower at -$ 4.35 / bbl with the visco spread at $ 1.35 /bbl.
Click Here for a graphical depiction of Fuel Oil stocks by region.
Nothing fresh to report today.
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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.