---

Commentary

Brent closed down $0.58 last night to $75.88 and WTI closed at $66.36 up $0.26. I mentioned yesterday that the "summit of the century" was the perfect deflection for an oil market that is finally realising that actually there may be a lot more oil come 2H 2018. For the bulls, it could be one of those hangovers that's so bad that you have to try and piece together the night by looking at your receipts the next morning. The issue is that if prices continue to fall before next week's meeting in Vienna, that OPEC may just "about face" and throw a gargantuan spanner in the works for anyone wishing for a market that makes sense and round we go on this merry go round once again. EIA data out later and the bulls must be praying for some decent news regarding crude and product draws. API (if you want to believe them) show a build on everything. Driving season? What are they driving? Segways? Good day.

Fuel Oil Market (June 12)

Crack -10.15 fairly steady today as Asian refining margins for fuel oil are set to hold near their current strong levels through the summer as increased use of the fuel by utilities to power air conditioners for cooling and disruptions to trade flows shrink global supplies. "Robust power generation demand in the Middle East (notably Saudi Arabia) should result in lower fuel oil outflows from the region, While fuel oil markets typically strengthen during the northern hemisphere summer months, trade sources said fuel oil margins have demonstrated additional strength this year by shrugging off sharp gains in crude oil prices LCOc1, which in mid-May climbed to their highest since November 2014.

Economic data/events (Times are London.)

* 9am: IEA monthly market report

* 12pm: U.S. MBA Mortgage Applications for June 8

* 1:30pm: U.S PPI Final Demand m/m for May

* 3:30pm: U.S. EIA weekly oil inventory report

* 7pm: Fed interest rate decision, followed by chairman Jerome Powell’s news conference

* Genscape weekly ARA crude stockpiles report

* Trafigura 1H results

* See OIL WEEKLY AGENDA for this week’s events

Singapore 380 cSt

Jul18 - 427.75 / 429.75

Aug18 - 423.75 / 425.75

Sep18 - 419.75 / 421.75

Oct18 - 415.75 / 417.75

Nov18 - 412.25 / 414.25

Dec18 - 408.75 / 410.75

Q3-18 - 423.75 / 425.75

Q4-18 - 412.00 / 414.00

Q1-19 - 400.00 / 402.50

Q2-19 - 387.50 / 390.00

CAL19 - 371.00 / 374.00

CAL20 - 298.50 / 303.50

Singapore 180 cSt

Jul18 - 438.25 / 440.25

Aug18 - 434.25 / 436.25

Sep18 - 430.50 / 432.50

Oct18 - 426.50 / 428.50

Nov18 - 423.50 / 425.50

Dec18 - 420.25 / 422.25

Q3-18 - 434.25 / 436.25

Q4-18 - 422.75 / 424.75

Q1-19 - 411.25 / 413.75

Q2-19 - 399.25 / 401.75

CAL19 - 385.50 / 388.50

CAL20 - 312.50 / 317.50

Rotterdam 3.5%

Jul18 - 411.25 / 413.25

Aug18 - 407.75 / 409.75

Sep18 - 403.50 / 405.50

Oct18 - 399.00 / 401.00

Nov18 - 394.50 / 396.50

Dec18 - 390.25 / 392.25

Q3-18 - 407.50 / 409.50

Q4-18 - 394.50 / 396.50

Q1-19 - 383.75 / 386.25

Q2-19 - 370.25 / 372.75

CAL19 - 350.00 / 353.00

CAL20 - 282.00 / 287.00