Good morning,
Brent crude futures fell 36 cents or 0.8% to $41.86 per barrel, and the WTI benchmark fell 43 cents or 1.1% to $39.73 per barrel after both climbed 4% over Wednesday.
EIA data welcomed a much needed draw in crude stocks by 4.4 million barrels which could be the reason for why crude jumped over 4% over the previous day, yet that gain was depressed by a larger than expected rise in the distillate stores, by over 3.5 million barrels. This is the key sticking point for market participants as diesel and heating oil begins to stock up raising question about the recovery of the global economy, levels not seen since 1991. US refiners are fining this a disincentive and last week’s processing of crude fell by just under 20% to 13.5 million bpd. (Reuters)
Today is the day the OPEC+ and its members are due to meet to discuss the plan of action for the rest of the year in terms of output and quotas for its members. Sources have said that it is unlikely to impose further cuts despite the recent price falls, as they had already imposed 8% cuts in July, to which some members have ignored. (Reuters)
Hurricane Sally made landfall in the US on Wednesday morning and continues to move inland, bringing with it up to 35 inches of rain which has dampened fuel demand. 508,000 bpd of production has been shut in a preventative measure against loss of life and damage to infrastructure. It Is expected that crew will be returned to the platforms imminently and production will begin to restart. (Reuters)
Reports from S&P platts yesterday outline the demand for bunkers is on decline due to the fallout of demand from COVID-19, further exacerbated by the IMO new mandate of VLSFO. Market participants expect demand to fall by 7-17% for the rest of 2020, with usually stable areas of sales of fuel oil in ports and coastal regions reporting drops of up to 40% year on year. On the other hand, Singapore bunker demand was in fact up from January to August by 5.3%, mainly due to its wide product offering. (S&P Platts)
MARKETS NEWS:
* Iraq Falters in Push to Meet OPEC+ Quota as Crude Exports Rise
* China’s Gasoline Output in August Climbs to 8-Month High
* Swollen Diesel Stockpiles Threaten Oil Price Recovery
* U.S. Gasoline Demand Seen Sputtering With End of Summer
* Tropical Storm Sally Drenches South With ‘Historic’ Flooding
* Chevron Restores Staff, Output to Gulf Fields Shut for Sally
* U.S. Gulf Shuts in 508,366 B/D or 27.5% Oil Production: BSEE
* Calif.-Blend Gasoline Stockpiles Rise 7.1% to 5.532M Bbl:
State
* Sinopec Processed Guyana’s Liza Oil at Maoming Plant First
Time
* Colombian Heavy Crude in a Sweet Spot on Kearl, Pemex Outage
* Alaska’s Alpine Oil Field Production Falls to Zero for 4 Days
* Russia Finance Ministry Seeks Higher Taxes for Mature Oil
Fields
* UAE Signals It’ll Atone For Pumping Too Much Oil in July,
August
OTHER NEWS:
* Petrobras Says Lula Oil Field Renamed Tupi on Court Order
PHYSICAL CRUDE NEWS:
* ASIA: Adnoc to Cut Nov. Term Supply by 25%; Vitol’s View
* LATAM: Castilla Price Levels; Mexico Crude Exports Fall
* US/CANADA: DAPL Likely Safe From Shutdown Through 2020
* NSEA: Equinor Sells Troll; Ekofisk Shipped to Bantry
* MED: Tupras Closes Sour Tender; Suezmax Freight’s YTD Low
* WAF: NNPC is Said to Extend Crude-for-Fuel Swap Contracts
OIL PRODUCT NEWS:
* U.S.: Diesel Stockpiles Threaten Oil Recovery
* EUROPE: Diesel Floating Storage; Gasoil Crack Drops
* ASIA: Oil Giants Focus on Hydrogen; Bunker Outlook
ECONOMIC DATA/EVENTS:
* JODI oil export data
* Singapore onshore oil-product stockpile weekly data
* OPEC+ to hold meeting of the Joint Ministerial Monitoring
Committee
* Nigeria, other WAF loading programs for Nov. may start to
emerge
* Insights Global weekly report on European refined product
inventories in ARA region
** See OIL WEEKLY AGENDA for this week’s events
ANALYST VIEWS/COLUMNS:
* Rapidan’s McNally Says OPEC Won’t Discuss Deeper Oil Cuts
Thurs.
* Fitch Solutions Sees Bigger Drop to India’s 2020 Fuels Demand
OTHER FINANCIAL MARKETS:
* Dollar Climbs After Fed; Stocks, Futures Decline: Markets Wrap
Singapore 380 INDIC
Oct20 243.00 / 245.00
Nov20 243.00 / 245.00
Dec20 244.00 / 246.00
Jan21 245.50 / 247.50
Feb21 247.25 / 249.25
Mar21 249.00 / 251.00
Q4-20 243.25 / 245.25
Q1-21 247.25 / 249.25
Q2-21 252.50 / 254.50
Q3-21 256.25 / 259.25
CAL21 254.00 / 257.00
Rotterdam 3.5% INDIC
Oct20 229.25 / 231.25
Nov20 228.50 / 230.50
Dec20 228.50 / 230.50
Jan21 230.25 / 232.25
Feb21 232.00 / 234.00
Mar21 233.75 / 235.75
Q4-20 228.75 / 230.75
Q1-21 232.00 / 234.00
Q2-21 236.75 / 238.75
Q3-21 239.75 / 242.75
CAL21 237.00 / 240.00
Singapore VLSFO 0.5% INDIC
Oct20 302.75 / 307.75
Nov20 303.25 / 308.25
Dec20 304.00 / 309.00
Jan21 305.50 / 310.50
Feb21 307.00 / 312.00
Mar21 308.50 / 313.50
Q4-20 303.25 / 308.25
Q1-21 307.00 / 312.00
Q2-21 311.00 / 317.00
Q3-21 315.00 / 321.00
CAL21 312.75 / 318.75
Rott VLSFO 0.5% INDIC
Oct20 277.75 / 282.75
Nov20 279.50 / 284.50
Dec20 281.50 / 286.50
Jan21 284.50 / 289.50
Feb21 287.00 / 292.00
Mar21 289.50 / 294.50
Q4-20 279.50 / 284.50
Q1-21 287.00 / 292.00
Q2-21 292.25 / 298.25
Q3-21 296.25 / 302.25
CAL21 293.50 / 299.50
Sing 10ppm GO INDIC
Oct20 43.83 / 43.97
Nov20 44.33 / 44.53
Dec20 44.88 / 45.08
Jan21 45.44 / 45.64
Feb21 46.00 / 46.20
Mar21 46.58 / 46.78
Q4-20 44.35 / 44.55
Q1-21 46.00 / 46.20
Q2-21 47.61 / 47.81
Q3-21 49.11 / 49.31
CAL21 48.07 / 48.47
ICE Gasoil 10ppm INDIC
Oct20 326.28 / 328.28
Nov20 332.89 / 334.89
Dec20 338.43 / 340.43
Jan21 344.21 / 346.21
Feb21 349.54 / 351.54
Mar21 353.33 / 355.33
Q4-20 332.55 / 334.55
Q1-21 349.02 / 351.02
Q2-21 359.91 / 361.91
Q3-21 374.05 / 376.05
CAL21 366.82 / 368.82
Rott Hi5 Sing Hi5
Oct20 50 61
Nov20 53 62
Dec20 55 62
Jan21 56 62
Feb21 57 61
Mar21 57 61
Q4-20 52 62
Q1-21 57 61
Q2-21 58 61
Q3-21 58 60
CAL21 58 60