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2020-11-19

MABUX: Bunker Market this morning, 19th November, 2020

Oil prices firmed by about 1% on Wednesday on hopes OPEC and its allies will delay The market was also supported by a smaller-than-expected increase in U.S. crude stockpiles last week.

Brent crude rose 59 cents, or 1.4%, to settle at $44.34 a barrel while U.S. West Texas Intermediate crude gained 39 cents, or 0.9%, to end the session at $41.82.

Both contracts jumped by about $1 after Pfizer Inc said that final results from late-stage trial of its vaccine showed it was 95% effective. Last week it had put the efficacy at more than 90%.

Moderna Inc on Monday said that preliminary data for its vaccine also showed it was almost 95% effective.

“Oil prices yesterday were modestly rising on hopes that OPEC+ will decide to postpone its planned production increase in January and on the latest vaccine euphoria,” said Rystad Energy’s head of oil markets, Bjornar Tonhaugen.

In the United States, crude inventories rose 768,000 barrels last week, compared with analyst expectations in a Reuters poll for a 1.7 million-barrel rise, government data showed. Distillate stockpiles, which include diesel and heating oil, fell by 5.2 million barrels, far exceeding expectations.

Oil futures eased on Thursday, surrendering some gains from the previous day as the surge in coronavirus cases and tighter economic restrictions around the globe stoked fears over slower fuel demand, outweighing upbeat vaccine news.

Brent crude futures shed 17 cents, or 0.4%, to $44.17 a barrel by 0345 GMT, after gaining 1.4% on the previous day. U.S. West Texas Intermediate crude declined 29 cents, or 0.7%, to $41.53 a barrel, having risen nearly 1% on Wednesday.

“The spread of coronavirus infection and fresh restrictions in the United States and other parts of the world hit market sentiment as it would hamper fuel demand,” said Kazuhiko Saito, chief analyst at Fujitomi Co.

“Investors are also booking profits from the recent rally before the U.S. Thanksgiving holiday later this month,” he said. The U.S. death toll from COVID-19 surpassed a grim new milestone of 250,000 lives lost on Wednesday, as New York City’s public school system, the nation’s largest, called a halt to in-classroom instruction, citing a jump in coronavirus infection rates.

Daily coronavirus cases in Tokyo and South Korea hit fresh highs, as pollution-cloaked New Delhi struggled with rising cases and Australia reported a highly contagious virus strain which forced a state-wide lockdown.

Worries about coronavirus-related economic damage overshadowed upbeat news from Pfizer and BioNTech that are seeking U.S. and European authorization for their COVID-19 vaccines next month.

Boosting worries about oversupply, Libya's National Oil Corporation (NOC) and France's Total discussed NOC's efforts to raise capacity and increase production rates to the highest levels.

Supporting prices, U.S. crude inventories rose 768,000 barrels last week, less than analyst expectations in a Reuters poll for a 1.7 million-barrel rise, government data showed. Distillate stockpiles, which include diesel and heating oil, fell by 5.2 million barrels, far exceeding expectations. [EIA/S]

“Still, lingering worries over a global supply glut, especially with the COVID-19-hit economies, will likely limit upside of oil prices,” Fujitomi’s Saito said, predicting WTI to be traded between $40 and $42 a barrel until the OPEC+ meeting later this month.

OPEC+, comprising the Organization of the Petroleum Exporting Countries, Russia and other producers, is due to discuss policy at a full ministerial meeting to be held on Nov. 30 and Dec. 1.

Members of OPEC+ are leaning towards delaying the current plan to boost output in January by 2 million barrels per day (bpd), sources have said.

Oil Future close 18th November, 2020

Brent crude: $ 44.34 (+0.59) /brl FM delivery Jan (FM=Front Month)

Light crude (WTI): $ 41.82 (+0.39) /brl FM delivery Dec

Gasoil ARA; $ 360.75 (+10.50) /mton FM delivery Dec

NY Harbor Ulsd: $ 389.14 (+7.67) /mton FM delivery Dec

Oil Futures trading at GMT 07.14; Brent: $-0.26, WTI: $-0.51.

Expect Fuel Oil prices little increase by +2-3 usd/mton

(Fuel Oil, means 380 HS plus VLSFO together).

MGO expected increase by +10 usd/mton

NY Harbor Ulsd expected increase by +8 usd/mton.

All prices are based on Oil Future close last night Wednesday evening.

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