Image credit: Freight Investor Services (FIS)

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Commentary

Morning. Oil prices dipped this morning as emerging market turbulence weighed on sentiment, while a deadline neared for a potential new round of U.S. tariffs on another $200 billion of Chinese goods. U.S. sanctions against Iran, however, prevented prices from falling further as they are expected to tighten the market after being implemented from November. Emerging market woes are weighing on global economic growth prospects, with Asian shares on Thursday heading for their sixth straight session of losses. Oil demand is expected to still be strong !!! U.S. crude stockpiles fell last week as refineries boosted output amid strong consumption, data from API showed on Wednesday. Crude inventories fell by 1.17 million barrels to 404.5 million barrels in the week to Aug. 31, while refinery crude runs rose by 198,000 bpd, the data showed. EIA data out at 4pm UK time, so hold onto your hats. Good day.

Fuel Oil Market (Sep 05)

Rising supplies drag cash premiums lower, Fuel oil cash differentials sagged to new multi-month lows on Wednesday as rising arbitrage flows into Singapore in September prompted suppliers to accept lower premiums for cargoes of the fuel in the Singapore trading window. The 380 cSt fuel oil cash premium slipped to $3.77 a tonne to Singapore quotes, its narrowest premium since July 5. Similarly, the 180 cSt fuel oil cash premium sank to its lowest since June 7 at $1.74 a tonne to Singapore quotes on Wednesday.

WINDOW TRADES - Three cargo trades were reported in the Singapore trading window, totalling 40,000 tonnes of 180 cSt high-sulphur fuel oil (HSFO) and 20,000 tonnes of 380 cSt HSFO.

- Trafigura sold both 180 cSt HSFO cargoes to Mercuria at a $1 per tonne premium to Singapore quotes.

- Mercuria in turn sold to Trafigura the 380 cSt cargo at a $3.50 premium to Singapore quotes.

Economic data/events (Times are London.)

* 9am: Singapore onshore oil-product stockpile data

* 4pm: EIA weekly U.S. oil inventory report (day later than usual because of Labor Day holiday)

* Russian refining maintenance schedule from ministry

* Africa Oil and Power conference in Cape Town, Day 2 of 3

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

Singapore 380 cSt

Oct18 - 428.25 / 430.25

Nov18 - 424.75 /426.75

Dec18 - 421.75 / 423.75

Jan19 - 418.50 / 420.50

Feb19 - 415.00 / 417.00

Mar19 - 412.00 / 414.00

Q4-18 - 424.75 / 426.75

Q1-19 - 415.25 / 417.25

Q2-19 - 405.50 / 408.00

Q3-19 - 390.00 / 392.50

CAL19 - 390.75 / 393.5

CAL20 - 322.75 / 328.75

Singapore 180 cSt

Oct18 - 435.00 / 437.00

Nov18 - 432.50 / 434.50

Dec18 - 431.00 / 433.00

Jan19 - 428.75 / 430.75

Feb19 - 425.50 / 427.50

Mar19 - 422.75 / 424.75

Q4-18 - 432.75 / 434.75

Q1-19 - 425.25 / 427.25

Q2-19 - 417.00 /419.50

Q3-19 - 405.00 / 407.50

CAL19 - 405.25 / 408.25

CAL20 - 345.75 / 351.75

Rotterdam 3.5%

Oct18 - 407.75 / 409.75

Nov18 - 404.00 / 406.00

Dec18 - 400.75 / 402.75

Jan19 - 398.25 / 400.25

Feb19 - 396.00 / 398.00

Mar19 - 393.50 / 395.50

Q4-18 - 404.25 / 406.25

Q1-19 - 396.00 / 398.00

Q2-19 - 387.00 / 389.50

Q3-19 - 368.50 / 371.00

CAL19 - 370.25 / 373.25

CAL20 - 310.75 /316.75