Brent hits fresh highs, mixed response in European oil products

London (Quantum Commodity Intelligence) - Brent rallied again Thursday, buoyed by US first quarter GDP growth of 6.4% and a healthy jobs report, but there was a mixed response in the European oil product complex.

The dollar index also stayed around two-month lows.

July Brent was trading around $67.68/b by 16.30 UK time, up 67cts/b from the same time Wednesday, despite concerns about the impact of the Covid-19 infection spike in India.

Products

Naphtha cargo prices in northwest Europe gained only $3.50/mt (39 cts/b) to leave crack values softer from yesterday. Wide backwardation persists at the front of the curve, but the May swap only gained $5/mt amid the rally in crude, and the paper spread to propane cargoes widened $4.50/mt. Propane cargo prices stayed the same. Saudi Aramco has lowered its official selling price for propane in May to $495/mt, down $65/mt.

Premium unleaded gasoline barge in ARA largely followed crude to be assessed at $653/mt, up $5.25/mt (63 cts/b). There were sizeable gains in the Eurobob E5 and E10 barge prices amid thin trade, and prices needed to correct higher to align with the rest of the gasoline market.

Jet differentials were steady against May Low Sulfur Gasoil futures, capped by an offer at $25/mt above the distillate future in cargoes, and a $22/mt offer in barges. Both jet markets gained a modest $4.25/mt (54 cts/b).

Distillate futures slightly trailed behind Brent. The calendarized value for Low Sulfur Gasoil futures in May, combing April and May contracts, was up $4.25/mt (57 cts/b). Diesel barges in ARA maintained recent strength to trade at flat to may Low Sulfur Gasoil futures, although trade was thin with only 5,000 mt changing hands.

Fuel oil was strong on the back of paper gains. High sulfur fuel oil barges were assessed at $376/mt, up $6/mt (94cts/b). Marine fuel (0.5% sulfur) barges in ARA were up $2/mt, and the spread between the two grades narrowed to $96/mt.