distillate fuel oil market set to tighten in 2018
Last Updated : GMT 06:49:16
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 06:49:16
Arab Today, arab today

Distillate fuel oil market set to tighten in 2018

Arab Today, arab today

Arab Today, arab today Distillate fuel oil market set to tighten in 2018

Rising prices for a whole range of primary commodities, including oil
London - Arab Today

US refineries are struggling to meet booming demand for distillate fuel oil at home and in export markets which will leave the distillate market very tight in 2018.
Even if the northern hemisphere winter is only averagely cold, the distillate market looks set to enter 2018 with lower-than-average stocks and fast-growing demand, which should keep prices and refining margins firm.
The gross refining margin for turning Brent into US heating oil has climbed to almost $19 per barrel from a recent low of less than $11 in May, despite record US refinery production of distillate.
Refiners therefore have a strong commercial incentive to maximize distillate output, which should ensure crude intake remains high, and spread tightness into the crude market. US refiners processed a seasonal record 16.6 million barrels per day (bpd) of crude last week, which was 600,000 bpd higher than at the same point in 2016 and 1.8 million bpd above the 10-year average.
And they produced a seasonal record 5.2 million bpd of distillate fuel oil, which was 300,000 bpd above 2016 and 600,000 bpd above the decade average.
But it was not enough to prevent distillate stocks falling by another 800,000 barrels to less than 125 million barrels, according to the US Energy Information Administration.
Distillate stocks have shrunk by 38 million barrels since the start of the year compared with a seasonal decline of less than 10 million in 2016 and a 10-year average of just 5 million.
Stocks are now 24 million barrels below the prior-year level, and 9 million barrels below the decade average, at levels that have not been seen since 2012-2014.
The distillate market was heavily oversupplied at the start of 2017 but has become progressively undersupplied in the course of the year.
Domestic consumption has been running well above prior-year levels and the long-term average in most weeks since March.
But it is the phenomenal strength of exports that is causing stocks to continue drawing down even as refineries maximize output.
Exports over the last four weeks were running at a record 1.5 million bpd, an increase of more than 400,000 bpd or almost 40 percent compared with the same period in 2016.
Distillate stocks look severely depleted even before the main winter heating season begins in North America and Western Europe.
The last two winters have been relatively mild in the US but if this one reverts to the mean stocks could start to feel tight.
While some distillate fuel oil is still used for heating, most is used in the high-powered engines used to move freight and industrial machinery so demand is closely linked to the business cycle and trade. With nearly all regions of the global economy experiencing a synchronized economic expansion and world trade volumes growing at the fastest rate for six years, distillate demand is growing rapidly.
The global economic expansion and trade upturn are expected to continue boosting demand even further in 2018/19 unless there is a major macroeconomic, financial or trade shock.
Rising prices for a whole range of primary commodities, including oil, will also spur faster economic growth in commodity-dependent developing countries, giving an extra impetus to distillate demand.
Commodity exporters accounted for some of the strongest growth in oil consumption, primarily diesel, before oil prices slumped in 2014, and could drive strong distillate demand growth again in 2018/19.
• John Kemp is a Reuters market analyst. The views expressed are his own

Source:Arabnews

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

distillate fuel oil market set to tighten in 2018 distillate fuel oil market set to tighten in 2018

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

distillate fuel oil market set to tighten in 2018 distillate fuel oil market set to tighten in 2018

 



GMT 10:10 2017 Thursday ,09 February

3 Important Elements You Have to Consider

GMT 04:03 2017 Monday ,24 April

Bella Hadid ‘dying’ to visit Palestine

GMT 19:25 2016 Wednesday ,25 May

The Brooklyn Desk by Oeuf NYC

GMT 07:49 2018 Friday ,05 January

2 Russian servicemen killed

GMT 07:58 2018 Monday ,01 January

Italy orders N. Korea's envoy to leave

GMT 08:45 2017 Wednesday ,20 December

US military imagines war without GPS

GMT 17:26 2017 Sunday ,17 December

Putin thanks Trump for help in foiling attack plot

GMT 22:19 2017 Monday ,16 October

Cairo-hosted Fatwa conf. new contribution

GMT 02:27 2016 Friday ,10 June

Video hints Japan abetting illegal ivory trade

GMT 07:04 2017 Wednesday ,19 April

1,883 Bahrainis found jobs in March

GMT 14:24 2016 Tuesday ,22 November

Citi and JPMorgan top list of ‘globally banks’

GMT 21:43 2017 Friday ,01 September

People question Nazaruddin`s repatriation expenses

GMT 09:41 2017 Wednesday ,19 April

OIC concerned over violence in Mali

GMT 01:30 2017 Friday ,27 October

May22/Jun21

GMT 05:38 2016 Friday ,30 December

Dubai Airports divert 13 flights due to heavy fog

GMT 11:38 2017 Saturday ,14 January

Mexico names new ambassador to US

GMT 12:03 2017 Wednesday ,22 March

Kuwait to mark World Water Day

GMT 15:00 2017 Wednesday ,27 September

HM King receives invitation from Egyptian President

GMT 02:45 2017 Tuesday ,05 December

President Bashir arrives in Chad

GMT 02:45 2017 Wednesday ,16 August

Turkmen President Visits Pakistan
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday