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
January 20, 2021

Prices rebounded

European gas prices rebounded yesterday, supported by new weather forecasts pointing to colder temperatures and ongoing weak LNG and pipeline supply. Russian flows were almost…
ES-gas
February 9, 2021

European gas prices extended gains

European gas prices increased significantly yesterday, still supported by the strong drop in temperatures. The rise in EUA and coal prices (which increased parity prices…
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]