Oil products rise on hopes for demand recovery

November 25, 2020
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Risavika LNG front month has dropped by 5.6 % week on week to 23.30 EUR/MWh on mild weather last week. Supply situation remains stable in Europe, while demand was comparably low during November. However, beginning of December is forecasted to be colder than seasonal norm, which should support the prices for front month.

Oil prices were supported by vaccine news last week, and remain supported for this week. Therefore, oil products have further gained 3.7-4.9 % during last week. Fuel oil 3.5 front month has increased by 4.9 % to 258.28 USD/t, low sulfur oil (MFO 0.5) has increased by 4.4 % and closed at 323.00 USD/t, and  MGO 0.1 has increased by 3.7 %week on week and closed at 353.97 USD/t.

Brent crude prices hit their highest levels since March as news of a third promising coronavirus vaccine candidate spurred hopes of a quicker recovery in oil demand. US crude oil inventories likely edged lower last week, while distillate stockpiles were seen decreasing for a 10th straight week, a preliminary Reuters poll showed on Monday. In addition, most analysts had expected OPEC+ to roll over its current level of cuts until end of Q1 2021, which provide additional support to the prices. As it is going to be some time before the vaccine reaches a critical mass, demand recovery is going to be likely delayed until mid-2021.

LNG Risavika – LNG FOB Risavika

LBG Risavika 10 % – 10 % blend of Liquified Biogas

FO 3.5 FOB Rdam – European 3.5% Fuel Oil Barges FOB Rdam (Platts) Futures Quotes

MFO 0.5 FOB Rdam – European FOB Rdam Marine Fuel 0.5% Barges (Platts) Futures Quotes

MGO 0.1 FOB ARA – Gasoil 0.1% Barges FOB ARA (Platts) Futures Quotes

ULSD FOB ARA – European Diesel 10 ppm Barges FOB ARA (Platts) Futures Quotes

Front Month Price index

LNG Risavika*

LBG blend

Risavika**

FO 3.5 FOB Rdam

MFO 0.5 FOB Rdam

MGO 0.1 FOB ARA

ULSD FOB ARA

Unit

23.30

26.30

18.52

22.18

24.30

25.74

EUR/MWh

394.72

445.54

258.28

323.00

353.97

359.05

USD/t

Price index 23.11.2020.png

Source: Gasum

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