Light Ends

Sing92 Spreads and E/W capped?

Light Ends

USGC gasoline stocks exceptionally low.

Chinese runs firmed on crude freed by the MoU ceasefire and SPR releases, but with that flow uncertain, runs should retreat in coming weeks, keeping product exports soft and cracks bid.

SING92 still lands competitively across Asia and into Southern and Eastern Africa.

As the EW retreats, Singapore cargoes have quickly reclaimed cheapest landed value into parts of LATAM, though Houston NJA remains cheapest into LA at current levels.

There remains the conflict caveat.

GC CBOB/RBOB will likely need to act as the solver over the coming months.

Arbs remain open for Hou to Far East

Light Ends

An apparent halt in Tehran-Washington re-escalation has triggered an immediate correction in MOPJ spreads and E/W.

Throughout the escalation swings, Houston physical premiums stayed weak, pushing A Grade blending in PADD 3 near workable. Houston to Chiba arbs remain open for light sweet grades, with Houston LR1 the second cheapest landed value into the region, behind Jeddah.

If the conflict resumes, the long-term risk is steam cracker demand destruction, likely from October to November. In prior rounds of conflict earlier this year, steam cracker utilisation fell from 80% to 60%. With Asian crackers now running at 75%, that overhang risk could resurface if the rally reverses.

Despite the pause, arbs into NWE stay closed while Asian physical premiums signal real tightness, leaving margin for European exporters. E/W will need to price in Rotterdam arbs; until then, MOPJ spreads and E/W look undervalued.