Asia naphtha crack turns positive, other cracks firm amid Suez delays
Dubai, UAE (Quantum Commodity Intelligence) - Benchmark Middle East crude oil ended softer Wednesday from the previous day's Singapore settlement, but prices recovered from the lows after a stranded container ship blocked passage through the Suez canal.
The blockage in the main artery for shipping to and from Europe to Asia turned front-month naphtha cracks positive for the first time in days while also providing some upward pressure to all other product cracks as traders feared the impact of a backlog in shipping.
Egypt's Suez Canal is a major transit route for both oil tankers and container ships, so any delays in reopening the waterway could cause major delays for oil tankers carrying sour Middle East sour crude to Europe and U.S., or Atlantic Basic sweet crude to Asia.
The Suez is also a major transit point for refined products.
As of Wednesday afternoon local time, Egyptian authorities were attempting to refloat the giant container vessel and resume shipping traffic.
Dubai cash for May delivery was assessed at $60.95 per barrel on March 24 (1630 Singapore time), down $2.05/b on Tuesday's Singapore close, while DME Oman futures for May were $1.92/b lower at $61.10/b. Both Dubai and Oman prices dipped below $60/b on Tuesday.
Products
In the product markets, the naphtha April crack swung from -$0.43/b to $0.21/b - an uplift that was mirrored across all other products as well as gasoline market, where the 92 RON crack firmed $0.39 to $5.73/b.
Only one cash transaction was heard - with 95 RON trading at a flat price of $70/b.
Similar to light-ends, the distillates cracks firmed, with both jet-kero and 10ppm gasoil rising - the former from $0.79/b on Tuesday to $1.85/b on Wednesday and the latter increasing $0.49 to $3.88/b.
Two cash deals were heard, with jet trading at a $0.50/b discount to the underlying swaps and 10ppm at a $0.30-discount.
In the fuel oil market the cracks rose 30-80 cents per barrel to -$4.60/b for 180cst, -$5.54/b for 380cst and $10.62/b for 0.5%.
In the cash market, 380cst cargoes were heard changing hands at a $1.50 discount to the underlying swap.