Crude OilCovid StatsNaphthaGasolineDisitllatesFuel OilHedge Strategy

Oil prices rose Friday but still settled the week lower after a rollercoaster ride where the market was first buffeted by Europe’s third wave of Covid-19, before being buoyed by a Suez Canal jam that could inordinately delay global shipments of crude. 

Brent crude finished the regular session higher by $2.48, or 4%, at $64.43. For the week, it showed a decline of 0.2%, adding to the combined 7% loss of the previous two weeks.

WTI settled Friday’s trade up $2.41, or 4.1%, at $60.97. For the week though, it was down 0.8%, extending last week’s 6.4% drop and the previous week’s 0.7% slide.

Oil is down Monday morning in Asia but stabilized after four consecutive sessions of wild movement. Efforts to get traffic moving again continue after the Ever Given container ship blocking the Suez Canal was refloated, while there was little change in terms of demand.

China and Iran, both subject to U.S. sanctions, signed a 25-year cooperation agreement on Saturday to strengthen their long-standing economic and political alliance.

U.S. oil rigs rose six to 324 this week, their highest since May, while gas rigs were unchanged at 92 for a fifth week in a row, energy services firm Baker Hughes Co said in its closely followed report on Friday.

At a global level, the death toll from the COVID-19 virus rose to 2,795,858 (+6,799 DoD) yesterday. The total number of active cases rose by around 110,000 DoD to 22.02 million. (Click here for details)

Germany’s third wave of the coronavirus could turn into the worst one so far and 100,000 new daily infections is not out of the question, the head of the German Robert Koch Institute (RKI) said.

Asia’s naphtha crack climbed to a near two-week high on Friday amid emerging concerns over arbitrage supply disruptions caused by the blockage in the Suez Canal. The naphtha crack jumped to $108.90 per tonne on Friday, the highest since March 15 and up from $100.15 per tonne a day earlier.

The April crack is lower at $0.85 /bbl

Asia’s gasoline crack slipped on Friday, weighed down by concerns about the impact on demand of extended lockdowns in Europe and disruptions to the distribution of coronavirus vaccines. The gasoline crack in Singapore slipped to $5.81 a barrel, down from a near two-week high of $5.98 per barrel on Thursday

Gasoline stocks held in ARA rose 2% to a seven-month high of 1.414 million tonnes in the week to March 25, data from Dutch consultancy Insights Global showed.

The April crack is unchanged at $7.65 /bbl.

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

Asia’s cash discounts for 10 ppm gasoil dipped by a cent to 28 cents per barrel to Singapore quotes on Friday.

Cash differentials for jet kero widened to 55 cents per barrel to Singapore quotes on Friday, compared with a discount of 52 cents per barrel on Thursday.

Widely watched airfares in China are recovering to pre-pandemic levels as domestic tourists lead a patchy air travel recovery, scattering crumbs of hope to a shattered global travel sector. With temporary testing and quarantine restrictions lifted, average prices for an economy seat during the April 3-5 Qingming festival, or tomb-sweeping holiday, have rebounded to 96% of 2019 levels, according to data from Ctrip.

Gasoil stocks held independently in ARA rose 4% to 2.5 million tonnes in the week to March 25, data from Dutch consultancy Insights Global showed. ARA jet fuel inventories fell 6.6% to 921,000 tonnes

The April crack for 500 ppm Gasoil is lower at $3.90 /bbl with the 10 ppm crack at $ 4.95 / bbl. The regrade is at -$ 1.25 /bbl. 

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

Asia’s 0.5% very low-sulphur fuel oil (VLSFO) and high-sulphur fuel oil (HSFO) markets firmed on Friday as concerns over potential supply disruptions emerged in the wake of the blockage in the Suez Canal.

“The market is worried about when their ship can actually cross the canal,” said a Singapore-based fuel oil trader adding that there is going to be some level of delays even if the shipping artery is reopened immediately.

Fuel oil stocks in ARA slipped 2%, or by 27,000 tonnes, to 1.716 million tonnes in the week ended March 25, data from Dutch consultancy Insights Global (IG) showed.

The April crack for 180 cst FO is lower at  -$3.80 /bbl with the visco spread at $1.00 /bbl.

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

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.

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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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