crude weekly insights – Fuel oil markets movements – Furnace oil prices up in India

crude prompt month benchmark futures sank this week. Front moth futures opened up in the beginning of the week, sagged down in the middle, Recovered on Friday, Finished the week down. It was a Yo-Yo market with many headlines back and forth, Keep changing before the ink is dry onthe newspaper.

Timespreads demonstrated downside momentum as it is a reversal of prevailing trend through ongoing supply crisis. Usually term structures strengthens with strong backwardation market strucuture when the month end contract expiry approaches . Traders expct strong current month prices compared to later month at the times of supply shortages.

Inventories data sent mixed signals to the markets. Strong draws from U.S SPR lent support to markets. Continued plunge in U.S gasoline markets also keep supporting oil prices last week.

Product markets are strong as refineries are still making excellent profits but diesel crack spreads continue to trade sideways as markes are digesting supply shortages.

Market Positioning data showed that money managers reduced net length in Brent crude F&O. As per the data speculators were the modest net buyers over the past week through Tuesday. Longs are leaving the market while short positions are building up

FUEL OIL MARKETS

Asian fuel oil markets softened in the Singapore trading window as weaker crude prices pressured both HSFO and VLSFO futures. HSFO 380 CST fell from around $720/mt to near $648/mt, while VLSFO 0.5% declined from nearly $878/mt to around $815/mt. Comfortable Singapore inventories and steady regional supply eased prompt market tightness, causing fuel oil time spreads to narrow from earlier strong backwardation levels. Fuel oil crack spreads also weakened, though refinery margins remain above historical averages. Meanwhile, the Hi-5 spread stayed elevated due to continued marine fuel demand and favorable scrubber economics supporting HSFO consumption.