The gasoline complex has seen bears entering the market although prices still seem to be supported to some extent. Here is a summary of what happened:
In the last two weeks, Apr EBOB crack saw a volatile price action although the contract overall strengthened from around $19.85/bbl on Feb to a high $23.05/bbl on Mar 01. The contract has however attracted more bearish interest with trade houses increasing their bearish play into the contract.
Gasoline E/W has seen a weaker fortnight, with price action plummeting to lows of -$10/bbl on Mar 04. On the same day, flows switched from sell-side to buy-side with trade houses and funds reverting their positioning.
TA Arb saw a choppy fortnight, with prices initially reaching a bottom of 16.35c/gal on Feb 27. Prices then continued to gap up and down for the rest of the two weeks. Interest for the contract continued to be bearish with market interest growing its bearish positioning. Notably, trade houses were seen selling by over 1.5mbbls on Mar 04.
Apr gasnaph was very volatile over the last week with the contract trading down to $200/mt before finding upward momentum into the end of the fortnight. Price action was overall rangebound as the contract was trading around $204/mt come Mar 04.
News/Headlines
Saudi Arabia was seen exporting a total of 76,668 mt of gasoline to Singapore during the week ending Feb 28, notably up from previously exporting none the week before, Enterprise Singapore data highlighted on Feb 29.
According to data from S&P Global Commodity Insights, the volume of Singapore gasoline swaps traded during the Platts Market on Close assessment process decreased by 43.14% in February, reaching 5.76 million barrels. The decline in volume represents a pullback from the six-month peak recorded in January, where 10.13 million barrels were traded, as indicated by S&P Global data. However, on a year-on-year basis, the volume for February has seen an increase by 9.72%.
The U.S. could sell its 1-million-barrel Northeast Gasoline Supply Reserve (NGSR) in the 2024 fiscal year, with a draft funding bill stating the possibility that the energy secretary would “sell one million barrels of refined petroleum product from the Strategic Petroleum Reserve during fiscal year 2024. The NGSR currently stores its one million barrels of gasoline as 700,000 barrels around New York Harbor, 200,000 barrels in the Boston area, and 100,000 barrels in South Portland, Maine.
