Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil prices gained on Monday for a fifth straight day, with Brent at its highest since October 2018 and heading for $80, as investors fretted about tighter supplies because of rising demand in parts of the world.

Brent crude was up $1.44, or 1.8%, to settle at $79.53 a barrel, having posted three straight weeks of gains. U.S. crude futures rose $1.47, or 2%, to settle at $75.45 a barrel, its highest since July, after rising for a fifth straight week.

Global oil demand is expected to reach pre-pandemic levels by early next year as the economy recovers, although spare refining capacity could weigh on the outlook, producers and traders said at an industry conference.

Global demand is seen rising to 100 million barrels per day by the end of 2021 or in the first quarter of 2022, Hess Corp President, Greg Hill said. The world consumed 99.7 million bpd of oil in 2019, according to the IEA, before the COVID-19 pandemic hammered economic activities and fuel demand.

Abu Dhabi National Oil Company has planned to supply full volumes of all crude grades to term customers in Asia in December, several sources with knowledge of the matter said on Monday. This will be the first time since the oil price crash in the second quarter of last year when the COVID-19 pandemic ravaged demand that ADNOC did not implement any supply cut, they said.


At a global level, the death toll from the COVID-19 virus rose to 4.77 Million (+5,351 DoD) yesterday. The total number of active cases rose by 100,000 DoD to 18.52 million. (Click here for details).

Asia’s naphtha crack remained little changed at $135.33 a tonne from $135.08 in the last session.

The October crack is lower at $3.55 / bbl.

Asia’s gasoline crack eased to $6.73 per barrel, hitting a two-week low, from $7.46 on Friday.

The October crack is lower at $8.80 / bbl.


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

Asia’s cash premiums for 10 ppm inched higher on Monday, holding close to a multi-month high touched last week, buoyed by tighter regional supplies and expectations for a gradual recovery in demand in coming months.

Cash differentials for gasoil with 10 ppm sulphur climbed to 46 cents per barrel to Singapore quotes, up one cent from Friday, and within close sight of last Wednesday’s 50 cents per barrel that was the highest premium since July 2020.

Refining margins or cracks for 10 ppm gasoil rose 45 cents to $11.69 per barrel over Dubai crude during Asian trading hours, a fresh high since March last year.

Asia’s cash differentials for jet fuel were at a premium of 5 cents per barrel to Singapore quotes, down 6 cents per barrel on Friday.

The October crack for 500 ppm Gasoil is higher at $10.15 /bbl with the 10 ppm crack at $ 11.65 /bbl. The regrade is at -$ 0.35 /bbl. 

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

Fuel oil cracks for both 0.5% very low-sulphur fuel oil (VLSFO) and high-sulphur fuel oil (HSFO) dipped on Monday after crude prices gained for a fifth day and as the bullish sentiment that sent the residuals market soaring over the past month eased.

While fuel oil continues to benefit from strong demand and tight supply, “structural constraints mean the upside to demand may not be as strong as some in the market believe,” said Energy Aspects in a note released on Monday.

The HSFO viscosity spread also tumbled to more than two-week low of $13.50 a tonne on Friday after hitting a record high of $25.25 on Monday, Refinitiv data showed. 

Fuel oil stocks in the ARA rose by 98,000 tonnes to a five-week high of 1.22 million tonnes in the week ended Sept. 23, data from Dutch consultancy Insights Global (IG) showed.

The October crack for 180 cst FO is lower at  -$2.10 /bbl with the visco spread at $2.40 /bbl.

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

No fresh trades 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.

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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