Crude Oil
Oil prices eased on Thursday as the market expected a quick recovery for production platforms shuttered ahead of Hurricane Laura.
Brent crude fell 55 cents to settle at $45.09 a barrel, while WTI fell 35 cents to $43.04 per barrel.
The storm hit Louisiana early Thursday with 150 mile-per-hour (240 kph) winds, damaging buildings, knocking down trees and cutting power to more than 400,000 people in Louisiana and Texas. Its storm surge was less than predicted, sparing inland plants from feared flooding. However, the storm narrowly missed the heart of the Gulf Coast refining complexes.
Upstream operators have begun restoring output and returning crews to US Gulf of Mexico platforms in the aftermath of powerful Hurricane Laura which came ashore early in the day, although few have reported so far, according to federal agency updates.
Indian state refiners have stopped buying crude oil from China-linked companies, after New Delhi’s recent regulation aimed at restricting imports from countries that it shares a border with, following a border clash between India and China.
Refineries in Nigeria, processed almost no crude oil in the 13 months to end Jun’20, however in the same period, operating costs for the country’s three main oil refineries, which the NNPC has shuttered pending revamps, totalled $367 million.
covid 19
At a global level, the death toll from the COVID-19 virus rose to 834,969 (+6,057 DoD) yesterday. The total number of active cases fell rose by around 68,000 to 6,694,565. (Click here for details).
Naphtha
Asia’s naphtha crack fell to a four-session low of $72 a tonne.
The September crack is lower at $0.45 /bbl.
Gasoline
Asia’s gasoline crack recovered from a five-session low to hit a two-day high of $2.80 a barrel on Thursday, as falling gasoline inventories and the hurricane season in the United States provided support.
Singapore’s onshore light distillates inventories fell 8% or close to 1.2 million barrels to reach a six-month low of 13.6 million barrels in the week ended Aug. 26, data from Enterprise Singapore showed.
The September crack is lower at $2.90 / bbl.
Click Here for a graphical depiction of Global Gasoline stocks by region.
Distillates
Cash discounts for 10 ppm gasoil were at 35 cents a barrel to Singapore quotes on Thursday, compared with a discount of 30 cents per barrel a day earlier.
Singapore onshore middle distillate stocks climbed 1.2% to 14.4 million barrels in the week ended Aug. 26, Enterprise Singapore data showed. Weekly Singapore middle distillate inventories have averaged about 13.1 million barrels so far in 2020. This week’s stocks were 27.7% higher year on year.
The September crack for 500 ppm Gasoil is lower at $3.45 /bbl with the 10 ppm crack at $ 4.25 / bbl. The regrade is at -$ 5.25 /bbl.
Click Here for a graphical depiction of Global Distillate stocks by region.
Fuel Oil
Despite tight supplies, Asia’s 380-cst HSFO cash differential sank to a narrow discount on Thursday due to a lower deal value in the Singapore trading window. The cash differential fell to minus 7 cents a tonne to Singapore quotes, down from a 66 cent per tonne premium in the previous session.
Singapore’s residual fuel oil inventories fell 9% to a four-month low in the week to Aug. 26 as net import volumes halved from the previous week. Onshore fuel oil stocks fell 2.354 million barrels to 23.131 million barrels according to Enterprise Singapore data. The last time inventories were lower was in the week to April 29 at 22.204 million barrels. Compared to levels a year ago, residual fuel stocks were 8% higher.
The September crack for 180 cst FO is unchanged at – $1.55 /bbl with the visco spread at $0.85 /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.