Crude Oil

Oil prices ended marginally higher as markets await the outcome of the US-China summit meeting on Saturday. Brent crude futures rose 6 cents to settle at $66.54 a barrel. WTI crude futures rose 5 cents to settle at $59.43 a barrel.

OPEC+ is expected to roll over a deal on cutting supplies at a meeting next week and discuss deepening the curbs, Iraq’s oil minister said.

U.S. President Donald Trump has agreed to no preconditions for his high-stakes meeting with Chinese President Xi Jinping this weekend and is maintaining his threat to impose new tariffs on Chinese goods, White House economic adviser Larry Kudlow said on Thursday. The South China Morning Post jointly reported that Washington and Beijing had agreed to a tentative truce in their trade dispute that would delay new U.S. tariffs, citing sources.

Tensions between the United States and Iran have also kept the market on edge. Iran is on course to breach a threshold in its nuclear agreement within days by accumulating more enriched uranium than permitted, although it had not done so yet by a deadline it set for Thursday.

Elsewhere, the government of Canada’s main crude producing province, Alberta, eased crude oil production curtailments for August on Thursday, setting the limit at 3.74 million bpd, compared with 3.71 million bpd in July.  

The US oil rig count rose by 5 week on week to 837 for the week ended June 26, S&P Global Platts Analytics said Thursday.


Asia’s naphtha reached a six week high of $29.65 a tonne on Thursday as demand from Taiwan and South Korea emerged.

Asia’s top naphtha buyer Formosa and South Korea’s Hanwha Total were looking to buy cargoes for August arrival. Formosa picked up around 100 KT of open specification naphtha for August arrival at Mailiao at discounts between $1 and $2 a tonne to its own price formula on a C&F basis, higher compared to a steeper discount of between $3 and $4 it had paid on May 30. The Taiwanese buyer had also bought 44 KT of liquefied petroleum gas (LPG) at a discount of $80 a tonne to naphtha benchmark prices.

The July crack is lower at -$ 6.00 /bbl


No fresh news. Light Distillate stocks in Singapore fell by 255 KB to 12.24 million barrels.

The July crack is lower at $ 6.25 / bbl

Click Here for a graphical depiction of Global Gasoline stocks by region.


Cash discounts for 10ppm gasoil widened to 9 cents a barrel to Singapore quotes on Thursday, compared with a discount of 8 cents per barrel a day earlier.

Cash discounts for jet fuel narrowed by 2 cents to 7 cents a barrel to Singapore quotes on Thursday.

The front month jet fuel spread , which has stayed in contango since November last year, flipped into a narrow backwardated structure on Thursday to be at a premium of 1 cent per barrel.

Middle Distillate stocks in Singapore rose by 1.07 million barrels to 11.39 million barrels, a four week high.

The July crack for 500 ppm Gasoil has dropped to $ 14.40 /bbl with the 10 ppm crack at $ 15.10 / bbl. The regrade is at  +$ 0.35 /bbl 

Click Here for a graphical depiction of Global Distillate stocks by region.

Fuel Oil

Concerns of tightening supplies have pushed Asia’s cash premiums and front month time spreads for 380 cst fuel oil  to fresh highs on Thursday.

The front month July/August 380 cst time spread jumped $2.25 a tonne from the previous session on Thursday to a more than four year high of $13.75 a tonne.

The 380 cst cash premiums also firmed to a near seven month high of $7.73 a tonne to Singapore quotes, up from $6.36 a tonne in the previous session.

Physical trade activity for cargoes of fuel oil in the Singapore window remained absent for a third consecutive session this week with buyers continuing to raise their bids but failing to lure suppliers.

This came as Singapore fuel oil inventories fell by 961 KB to a three week low of 22.84 million barrels in the week ended June 26.

The July180 cst crack is stronger at  + $ 0.60 / bbl with the visco spread narrowing further to $ 1.05 /bbl.

Click Here for a graphical depiction of Fuel Oil stocks by region.

Hedge Recommendations

Gasoil cracks have retraced rather dramatically today. Fuel Oil cracks have strengthened only in the prompt. We shall continue to wait for August at levels higher than -$1.00 / bbl.

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 refiner.

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.

Disclaimer : All the views are the author’s personal views. These do not constitute an advice to buy or sell any commodity

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