Brent corrects lower, gasoline resilient and cracks rally

London (Quantum Commodity Intelligence) - Brent and distillate futures corrected lower Friday amid a rally in the dollar index, but gasoline prices were resilient.

July Brent dropped $1.278/b by 1630 UK time compared to Thursday.

Meanwhile, June Brent was heading to expiry 75cts/b higher than the second-month future at the time.

Products

Naphtha cargoes fell in line with Brent, with prices dropping $11/mt ($1.22/b), which crunched the spread above propane cargoes to $97.25/mt.

But gasoline prices in ARA were resilient. Premium unleaded barges in ARA dropped $7.25/mt (84 cts/b) after trading at $646/mt. Eurobob E5 fell only $2/mt, while E10 barges were 0.75 cts/b higher, but both grades reflected trades before crude prices dropped. Gasoline stocks in ARA were up 0.9% to 1.2 million mt in the week to April 29, according to data from Insights Global.

Jet premiums have stalled in ARA, with cargoes offered at $25 above Low Sulfur Gasoil futures, and barges offered at $22/mt. Prices dropped in line with distillate futures Friday. Jet stocks in ARA rose 12% over the week to 980,000 mt, according to Insights Global.

Distillate futures fell more than Brent after yesterday failing to rise as quickly as Brent, depressing cracks in middle distillates for the second day in a row. Diesel barges in ARA were assessed again at flat versus May Low Sulfur gasoil futures, after bids at -50cts/b and offers at 75 cts/b. Diesel and gasoil stocks in ARA climbed 4.2% over the week to 2.2 million mt.

Fuel oil barges slightly outstripped Brent, correcting yesterday's gains, with high sulfur fuel oil barges trading at $366.75/mt and marine fuel (0.5% sulfur) barges in ARA trading at $462/mt. The spread between the two grades continued to narrow.