Japanese oil-to-gas switch remains elusive

Crude prices remained elevated, at 82.2 $/b for ICE Brent front-month price, despite the SPR release announcement and a relatively neutral EIA weekly snapshot. Total crude inventories declined (accounting for the SPR release of last week) while distillate stocks declined further, likely due to a slower than anticipated ramp-up in US refining runs. Gasoline inventories also hovered around the lower end of the 5-year average, but draws should ease after Thanksgiving due to consumer hoarding. US demand remained very strong, at 21.8 mb/d for last week, at a seasonally all-time high.
In Japan, crude stocks built by 3.2 mb while diesel stocks managed to stabilize at 8 mb. There is still no signs of winter planning seen in Japanese stocks which would lend support to the oil-to-gas switching theory. Diesel and fuel oil stocks are low and did not exhibit any material builds despite all Asian petroleum product prices incentivizing switching in the power sector.

Share this news :

You might also read :

ES-gas
November 4, 2021

Strong price rebound

European gas prices continued their rebound yesterday, posting strong gains as they got support from the rise in Asia JKM prices (+7.15%, to €82.262/MWh, on…
ES-gas
October 13, 2021

Slight price rebound

European gas prices rebounded slightly yesterday, torn between conflicting fundamentals (in particular weak stock levels, but hopes for an increase in Russian flows). Asia JKM…
ES-oil
September 3, 2021

Longer-term hurricane impacts emerge

The BSEE reported that as of yesterday that the total outages in the Gulf of Mexico remained at 1.7 mb/d, which was revised higher from…
Join EnergyScan

Get more analysis and data with our Premium subscription

Ask for a free trial here

Don’t have an account yet? 

[booked-calendar]