Image credit: Freight Investor Services (FIS)

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Commentary

Oil prices drop as escalating U.S.-China trade war clouds the demand outlook. The growing trade dispute has hurt trading sentiment. The impact on economic growth is slowly being felt, which again hurts oil prices. Refineries in the United States consumed about 17.7 million (bpd) of crude oil last week while China's refiners used about 11.8 million bpd in August, according to government data from the countries, the most among the world's countries. The tariffs are likely to limit economic activity in both the China and the United States and that should lower oil demand growth as less fuel is consumed to move goods for trade. However, potential supply cuts caused by U.S. sanctions on Iran, the third-largest producer among the members of the (OPEC), are providing some support for oil prices. Sanctions affecting Iran's petroleum sector will come into force from Nov. 4. We will be in the range of 75-80 for now... buy the dips. Good day.

Fuel Oil Market (Sep 17)

The front-month 380 cSt barge crack discount to Brent crude held steady on Monday despite rising crude oil prices. The October 380 cSt barge crack to Brent crude was trading at about -$11.35 a barrel today, unchanged from its settlement on Friday. This came amid higher oil prices on Monday as investors focused on the impact of U.S. sanctions on Iran despite assurances by Washington that Saudi Arabia, Russia and the United States could together raise output fast enough to offset falling supplies.

WINDOW TRADES - One cargo trades was reported in the Singapore trading window totalling 20,000 tonnes of 180-cst high-sulphur fuel oil (HSFO).

- Trafigura sold the cargo to Vitol a

Economic data/events (Times are London.)

* 9:30pm: API issues weekly U.S. oil inventory report

* JODI oil export, output data for July

* 72nd Regular Session of the UN General Assembly starts, with U.S. President Donald Trump and Iranian President Hassan Rouhani expected to attend

Singapore 380 cSt

Oct18 - 437.75 / 439.75

Nov18 - 434.00 / 436.00

Dec18 - 430.25 / 432.25

Jan19 - 426.50 / 428.50

Feb19 - 422.75 / 424.75

Mar19 - 419.00 / 421.00

Q4-18 - 434.00 / 436.00

Q1-19 - 422.00 / 424.00

Q2-19 - 411.00 / 413.50

Q3-19 - 392.00 / 394.50

CAL19 - 395.50 / 398.50

CAL20 - 326.25 / 332.25

Singapore 180 cSt

Oct18 - 444.50 / 446.50

Nov18 - 441.75 / 443.75

Dec18 - 439.00 / 441.00

Jan19 - 436.25 / 438.25

Feb19 - 433.00 / 435.00

Mar19 - 429.50 / 431.50

Q4-18 - 441.75 / 443.75

Q1-19 - 432.50 / 434.50

Q2-19 - 422.50 / 425.00

Q3-19 - 408.00 / 410.50

CAL19 - 410.00 / 413.00

CAL20 - 349.50 / 355.50

Rotterdam 3.5%

Oct18 - 416.50 / 418.50

Nov18 - 412.25 / 414.25

Dec18 - 408.25 / 410.25

Jan19 - 405.50 / 407.50

Feb19 - 403.00 / 405.00

Mar19 - 400.00 / 402.00

Q4-18 - 412.25 / 414.25

Q1-19 - 402.75 / 404.75

Q2-19 - 392.50 / 395.00

Q3-19 - 371.00 / 373.50

CAL19 - 373.50 / 376.50

CAL20 - 305.00 / 311.00