Brent ticks higher, HSFO rallies

Brent ticked higher by 16.30 UK time for the fourth trading day in a row Tuesday, but European distillate futures diverged with Low Sulfur Gasoil futures settling lower to create a mixed bag of moves in European oil products.

June Brent was up by 37 cts/b by 16.30 UK time compared to yesterday, but May Low Sulfur Gasoil futures settled $1.25/mt (16.5 cts/b) lower.

Crude markets were buoyed early in the day after data showed Chinese crude imports in March were up 21% year-on-year to 11.69 million bpd.

Imports were little changed month-on-month, allaying fears of a slowdown in Chinese buying.

There were also reports of Yemini Houthi rebels launching drones and missiles targeting Saudi Aramco plants in Jeddah and Jubail.

But oil futures remain rangebound as the market waits for more clarity and signals over the pace of global oil demand growth, and whether OPEC cohesion will continue to hold.

Products

Premium unleaded gasoline barge prices in ARA were up $4/mt, following crude, and waiting for Wednesday's US government stock data for direction.

Naphtha cargo prices in north Europe were up just $2/mt, to soften the crack value versus Brent futures again.

Ultra low sulfur diesel barges in ARA softened further than distillate futures, dropping $1.75/mt.

Jet fuel barges traded twice at $19/mt and $18.50/mt above May Low Sulfur Gasoil futures, and fell only 50 cts from yesterday. Jet cargos in north Europe were assessed in parity with barges in ARA.

There was another mixed day in the fuel market, but the pattern was the same with the spread between high sulfur and marine fuel 0.5% sulfur barges in ARA narrowing. High sulfur fuel oil barges rallied $7.25 /mt, while marine fuel 0.5% sulfur barges were only up $1.25/mt, narrowing the spread between the two grades to $106/mt, which is still historically wide.