Middle East crude softens, light-end cracks stable, fuel, distillates ease

Dubai, UAE (Quantum Commodity Intelligence) - Benchmark Middle East crude oil ended little changed Tuesday at the Singapore settlement, before resuming the downtrend as European markets opened and demand concerns took centre stage.

Dubai cash for May delivery was assessed at $63.00 per barrel on March 22 (1630pm Singapore time), down $0.15/b on Monday's Singapore close, while DME Oman futures for May were $0.30/b lower at $63.00/b.  

Later news that Germany would enter a six-day lockdown over the Easter holidays raised demand-recovery fears among investors, adding to the already weak sentiment.

Middle East crude was also weighed down on reports than Iran exports remain at 'elevated levels', despite continued U.S. sanctions.

In the product markets, weak demand saw fuel oil cracks ease across all three main grades, with 180cst April swaps falling 48 cents to -$5.43/b, the 380cst swap falling 59 cents to -$6.35/b and the Marine Fuel April crack falling to $10.30/b.

On the physical side, 40,000 mt of 380cst was heard traded at a $1.50/mt discount to the underlying swaps with 180cst at a $1/mt discount, meaning cash prices held up slightly better than the curve.

Similar to fuel, the distillate cracks eased, with the April crack for 10ppm gasoil falling to $3.39/b versus $4.06/b a day earlier and the April crack for jet/kero halving from $1.46/b to just $0.79/b.

On the physical side, a trade was heard for a jet cargo for first half April at -$0.40/bl discount to the underlying swaps and two gasoil trades for 150,000 barrels a piece were heard at -$0.20/b to the underlying swaps.

On the light ends, both naphtha and gasoline 92 RON cracks were broadly unchanged at -$0.43/b for the former and $5.34/b for the latter. Physical Mogas was pegged lower with a part cargo of RON 95 trading at $71.60/bl, down 40 c/bl on the day.