---

Commentary

Brent closed last night at $76.31, up $1.58, and WTI closed at $70.53, up $2.45. I feel that there is no better way of summing up the oil market right now than to quote dear old Donald Rumsfeld... "As we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns - the ones we don't know we don't know." Right on. It is perhaps weak or naive of a daily commentator on the oil market to reuse previous quotes, but as much as I think the above paragraph is absolutely nuts, there is something that is, quite frankly, absolutely brilliant. Let's face it, there isn't much of a story to the bearish side of this market at the moment. If we look at the way the market has reacted so far this year to any news of a bullish nature, then the next few weeks could really see us test the stratospheric predictions of some analysts of crude reaching prices above $90. EIA data will no doubt show a significant draw on both crude stocks and Cushing inventories owing to the Canadian pipeline outage, if the API is anything to go on. If gasoline stocks show a healthy draw as well, then the demand argument is now fully justified. Sanctions on Iran are only going to be supportive for Middle East grades as Trump is not letting up in any way whatsoever on his lambasting of the country. Grim if you're a consumer. And we are all consumers in the end. Good day.

Fuel Oil Market (June 26)

The front crack opened at -9.60, before strengthening to - 9.20, before weakening to -9.40. The Cal 19 was valued at - 15.80.

Asia's fuel oil crack value for 180 cSt grade at less than $5 a tonne discount to Brent oil on Tuesday was the narrowest seen since Nov. 20, 2017 when it was $4.40, supported by firm demand against a smaller pool of supplies. The stronger fundamentals also pushed Asia's cash premiums for 380 cSt and 180 cSt fuel oil grades to multi-year highs.

Lower fuel oil output in Venezuela due to refinery outages and a lack of crude oil, and refinery upgrades in Russia, the Middle East, India and South Korea have all contributed to tightening global supplies of the fuel, used to generate electricity and power industrial boilers and ships.

Japan's Idemitsu Kosan is set to restart its 150,000 barrelsper-day (bpd) sole crude distillation unit (CDU) at Hokkaido refinery in northern Japan by July 10 following a scheduled maintenance

Economic data/events (Times are London.)

* 12pm: MBA Mortgage Applications, June 22

* 1:30pm: U.S. Durable Goods Orders, May (prelim)

* 1:30pm: U.S. Retail Inventories, May

* 3pm: U.S. Pending Home Sales, May

* 3:30pm: EIA weekly oil inventory report

* Genscape weekly ARA crude stockpiles report

** See OIL WEEKLY AGENDA for this week’s events

Singapore 380 cSt

Jul18 - 444.50 / 446.50

Aug18 - 437.75 / 439.75

Sep18 - 432.25 / 434.25

Oct18 - 428.25 / 430.25

Nov18 - 425.00 / 427.00

Dec18 - 421.75 / 423.75

Q3-18 - 438.25 / 440.25

Q4-18 - 425.25 / 427.25

Q1-19 - 415.00 / 417.50

Q2-19 - 403.00 / 405.50

CAL19 - 381.25 / 384.25

CAL20 - 306.50 / 312.50

Singapore 180 cSt

Jul18 - 453.00 / 455.00

Aug18 - 447.00 / 449.00

Sep18 - 442.50 / 444.50

Oct18 - 438.75 / 440.75

Nov18 - 435.75 / 437.75

Dec18 - 432.75 / 434.75

Q3-18 - 447.50 / 449.50

Q4-18 - 436.00 / 438.00

Q1-19 - 426.25 / 428.75

Q2-19 - 415.75 / 418.25

CAL19 - 396.25 / 399.25

CAL20 - 329.75 / 335.75

Rotterdam 3.5%

Jul18 - 423.25 / 425.25

Aug18 - 420.00 / 422.00

Sep18 - 415.75 / 417.75

Oct18 - 411.25 / 413.25

Nov18 - 407.00 / 409.00

Dec18 - 403.00 / 405.00

Q3-18 - 419.75 / 421.75

Q4-18 - 407.00 / 409.00

Q1-19 - 396.75 / 399.25

Q2-19 - 384.00 / 386.50

CAL19 - 359.00 / 362.00

CAL20 - 290.50 / 296.50