Asia’s naphtha refining margins climbed to their highest in more than a month on Wednesday, buoyed by softer crude oil prices and concerns of tighter distillate flows after U.S. President Donald Trump reimposed a stricter policy on Iran’s oil exports.
The crack (NAF-SIN-CRK) jumped $7.90 from the previous day to $98.45, its strongest level since Jan. 3. Backwardation between the second-half March and April contracts widened by $1.25 to $5.
Trump on Tuesday restored his “maximum pressure” campaign on Iran that includes efforts to drive its oil exports down to zero in order to stop Tehran from obtaining a nuclear weapon.
The country’s oil minister on Wednesday said imposing unilateral sanctions on crude producers would destabilise energy markets, and that it had prepared strategies for any situation regarding U.S. sanctions.
Meanwhile, in the gasoline market, refining margins (GL92-SIN-CRK) recorded a second straight session of losses, falling $0.48 from a day earlier to $7.89, as firmer inventories of the distillate product amid a softer demand outlook weighed on the market.
INVENTORIES
U.S. gasoline stocks rose by 5.43 million barrels in the week ended Jan. 31, while crude oil stocks gained 5.03 million barrels, market sources citing American Petroleum Institute figures on Tuesday.
Light distillate inventories, including naphtha and gasoline, at the Fujairah commercial hub climbed for the second consecutive week in the week to Feb. 3, gaining 0.881 million barrels to 8.339 million barrels, S&P Global Commodity Insights data showed on Wednesday.
NEWS
Oil prices dipped on Wednesday as rising U.S. stockpiles and concern about a new Sino-U.S. trade war fuelled fears of weaker economic growth, offseting U.S. President Trump’s renewed push to eliminate Iranian crude exports.
Norwegian producer Equinor EQNR on Wednesday raised its 2030 oil and gas output forecast and scaled back plans for renewable energy capacity expansion, while reporting a smaller-than-expected decline in profit for the final quarter of 2024.
French oil major TotalEnergies TTE reported a 15% drop in fourth-quarter earnings on Wednesday, closing out a year marked by low oil prices and weak fuel demand that were partially offset by higher electricity sales and liquefied natural gas trading.
SINGAPORE CASH DEALS
One octane-92 gasoline trade, one octane-95 gasoline trade, two octane-97 gasoline trades and no naphtha trades for the day.
Source: Reuters