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Commentary

Brent crude futures were at $77.54 per barrel at 02:53 GMT, down 8 cents from their last close. U.S. WTI futures were at $72.54 a barrel, down 22 cents, or 0.3 percent, from their last settlement. Just when you think you are finally getting a hold of what's going on in the market, Boom, something else pops into focus and sends the market in a seemingly inconceivable direction on news which normally prompts the response of "really?!?"

That was a good draw of U.S. stocks that was reported yesterday by the EIA, giving real credence to the OPEC PR line that oversupply has been dealt with. It can justify us loosening our belts a bit as our compliance has been better than expected the previous months. With Trump calling on U.S. allies to stop buying crude, this has clearly spooked the market into thinking that a drop in Iranian supplies worldwide will further increase the deficit with OPEC 'sticking to 100% compliance'. I use quotations sarcastically as this is somewhat the same logic as that Little Britain sketch: "it's half the calories, so I can eat twice as much". OPEC: "We are increasing production, but we aren't, so supplies from us will increase, but for the world stay the same". We'll just totally ignore that whole chocolate bar you ate (i.e. U.S. production increase). It follows about as much logic as Trump bemoaning high oil prices and then further reducing supply with sanctions. Good day.

Fuel Oil Market (June 27)

The front crack opened at -9.40, before strengthening to - 9.30, before weakening to -9.60, closing -9.45. The Cal 19 was valued at -15.50

The discount on Asia's 180 cSt fuel oil crack to Brent on Wednesday narrowed to a fresh 31-week high as persisting tight supplies countered strong oil prices

The 180 cSt crack value was at a discount of $4.63 a barrel, the narrowest since Nov. 20, 2017 when it was at $4.40. Although the fuel oil stocks in Fujairah were seen higher, current levels were considerably lower when compared to the same period from a year ago

Fujairah's fuel oil inventories had reached a two-week high of about 9 million barrels in the week to June 25. But not only was the increase from the previous week marginal at 0.23 percent, current stockpiles in Fujairah were still about 27 percent lower versus the same period last year

Economic data/events (Times are London.)

* 1:30pm: U.S. GDP Annualized, 1Q

* 1:30pm: U.S. Initial Jobless Claims, June 23

* 1:30pm: U.S. Continuing Claims, June 16

* 2:45pm: Bloomberg Consumer Comfort, June 24

* 4pm: Kansas City Fed Manufacturing Activity, June

* Singapore onshore oil-product stockpile data

* Russian refining maintenance schedule from ministry

Singapore 380 cSt

Jul18 - 453.50 / 455.50

Aug18 - 446.50 / 448.50

Sep18 - 440.50 / 442.50

Oct18 - 436.00 / 438.00

Nov18 - 432.75 / 434.75

Dec18 - 429.50 / 431.50

Q3-18 - 447.00 / 449.00

Q4-18 - 433.50 / 435.50

Q1-19 - 423.25 / 425.75

Q2-19 - 411.25 / 413.75

CAL19 - 389.50 / 392.50

CAL20 - 311.00 / 317.00

Singapore 180 cSt

Jul18 - 461.50 / 463.50

Aug18 - 455.50 / 457.50

Sep18 - 450.50 / 452.50

Oct18 - 446.50 / 448.50

Nov18 - 443.50 / 445.50

Dec18 - 440.50 / 442.50

Q3-18 - 456.00 / 458.00

Q4-18 - 444.25 / 446.25

Q1-19 - 434.50 / 437.00

Q2-19 - 424.00 / 426.50

CAL19 - 404.50 / 407.50

CAL20 - 336.00 / 342.00

Rotterdam 3.5%

Jul18 - 431.50 / 433.50

Aug18 - 428.00 / 430.00

Sep18 - 423.50 / 425.50

Oct18 - 419.00 / 421.00

Nov18 - 414.75 / 416.75

Dec18 - 410.75 / 412.75

Q3-18 - 427.50 / 429.50

Q4-18 - 414.75 / 416.75

Q1-19 - 404.50 / 407.00

Q2-19 - 391.75 / 394.25

CAL19 - 367.25 / 370.25

CAL20 - 296.75 / 302.75