Asia oil/products: Crude at fresh highs, distillate, gasoline cracks fall

28 Jun 2021

Quantum Commodity Intelligence – Middle East crude tracked higher Friday hitting a fresh 26-month highs, while refined products all declined bar fuel oil as the spread of the Delta variant in Asia weighs on demand.

Dubai cash for August delivery was assessed at $73.85/b on June 28 (1630 Singapore time), up $0.40/b from pre-weekend levels, while DME Oman futures for August settled $73.72/b at the Asia close, up $0.32/b.

Cash Brent (BFOE) for August was assessed at $75.93/b, up $0.20/b from Friday’s Asian close, narrowing the Brent/Dubai spread to $2.08/b and the EFS to $4.02/b.

Meanwhile, ADNOC informed term customers of 15% cuts to September loadings, a move that is likely to help keep the market balanced to tight when the September-trading cycle starts next week.

ADNOC also said it would have 1.07 million bpd of Murban crude available for export in July, with volumes rising to 1.105 million bpd in August.

Product

Naphtha cracks flatlined on Monday, no deals were heard and swaps largely tracked crude. The flat price moved sideways at $663/mt CIF Japan.

Gasoline cracks gave up three days of gains on Monday, amid fresh curbs to combat rising infections in southeast Asia. Swaps fell against a rising crude complex, pressuring the cracks along the curve. Nearby July cracks for 92 RON dipped more than $0.60/b to $6.40. Q4 cracks were only down $0.04/b. The July-Aug spread fell to $0.20 from $0.35/b. RON 92 flat prices were marked at $81.51/b FOB Singapore.

Jet fuel cracks hit a fresh 10-week low as restrictions in Asia weighed. In the cash market, bids and offers remain wide apart. The cash differential was marked at -$0.40/b. Spot was assessed at $77.36/b FOB Singapore, leaving jet cracks in a bear trend for almost six weeks.

Diesel cracks also slipped on Monday, falling more than $0.40/b as the rise in crude was met with a fall in diesel. No cash deals were heard and the cash differentials for 10ppm was marked at $0.15/b. Restrictions in southeast Asia were seen to be hitting cracks.10ppm was marked at $80.31/ FOB Singapore.

Fuel oil cracks firmed, the only product to do so and albeit marginally. 3.5% 380 cst was marked at -$9.83/b versus Brent, up just $0.03/b on the day at a flat price of $419.75/mt FOB Singapore. 0.5% marine fuel was pegged at $1.93/b, up $0.23/b on the day.