Light Ends

Market Overview

Still bullish EBOB cracks

MOGAS

With Saudi Red Sea refiners remain constrained, the Middle East and its own typical shorts (e.g. East Africa) are in need of prompt supply. Europe is effectively soaking up demand from WAF and AG.

(EBOB crack)

While diesel takes the spotlight in Europe, gasoline cracks are also well supported.

Another structural support is the continued push by European refiners to maximise every drop of diesel will eat into gasoline yields, even if there is robust demand for exports.

Bearish MOPJ Spreads, bullish Gas-Nap

Naphtha

Combine weak naphtha with the strength in gasoline (reaffirming our bullish view on EBOB), and you have a perfect recipe for staying long Gas-Nap, even at these extreme highs.

(Prompt Gas-Nap vs MOPJ spread)

After an initial spike, MOPJ spreads weakened the very next day in response to the Saudi pipeline attack, underlining just how weak Asian demand is. Any fresh news around Yanbu refinery restarts add further bearish pressure.