OIL PRODUCTS: Trafigura Says More of its VLCC's Could Switch to Clean
Sep-11 07:59
Trafigura said it could switch more of its crude oil tankers to carry clean products if sluggish market conditions persist according to a Bloomberg interview.
- Andrea Olivi, head of wet freight said “From what we see in the market today, I would expect this number to potentially increase,” he said.
- About 12% of Trafigura’s fleet of VLCCs and 20% of its Suezmaxes can carry those fuels on top of shipping denser crude.
- The move was driven in recent months by weakness out of China while extended production cuts by OPEC mean there is less oil needing to be moved.
- Vortexa has recorded record levels of tankers making the switch from dirty to clean in recent months recording over 37 VLCC’s and Suezmax vessles.
- The record number of VLCCs loading diesel from the Middle East in August capped demand for LRs. (see chart)
Source: Vortexa
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EQUITIES: Consumer and Option expiry in focus this week
Aug-12 07:54
- Aside from the big data week, Equity desks will be focused on couple things this week, US Consumer earnings, with Home Depot Tuesday and Walmart Thursday.
Friday also sees Option expiries, in Notional terms:
US:
- SPX: 1.15T.
- NDX: 86.4bn.
- Amazon: 12.65bn.
- Apple: 20.29bn.
EU:
- SX5E: 98.9bn.
- SX7E: 3.17bn.
- CAC: 4.92bn.
- DAX: 15.02bn.
- FTSE: 9.61bn.
GILTS: Broadly in line with post-close Friday levels with a busy week ahead
Aug-12 07:53
- It's set to be a very busy data week for the UK with labour market data tomorrow, inflation Wednesday, monthly activity data (and first read of Q2 GDP) on Thursday and then July retail sales data on Friday.
- Gilt futures opened around 20 ticks below Friday's last trade (around 30 ticks below Friday's "official" close), and have made up around 20 ticks - so trade at similar levels to Friday 17:00-18:00BST with the curve steepening slightly. SONIA futures are up to 2.5 ticks softer in the Whites / Reds.
- Gilts are outperforming both Bunds and Treasuries this morning - with the 10-year gilt-Bund spread moving a little below the 172bp level that was being challenged last week.
- Since Friday's close, we have also heard from external MPC member Catherine Mann in an FT interview, who described her level of hawkishness as falling from 10 to 7 this year. She is still dissenting against rate cuts, and remains concerned about structural changes to wage behaviour. There are no other MPC scheduled appearances until Governor Bailey speaks at Jackson Hole Friday next week.
- In terms of market pricing for upcoming MPC meetings, around 9bp (35% prob of cut) is priced for September, 29bp for November and 43bp by year-end. 101bp (4x25bp cuts) remain priced by June 2025.
GOLD: Gains $58 in the past 3 sessions
Aug-12 07:36
- The precious metal has cleared Friday's high, gaining $58 in just the past 3 sessions, and the early price action is now supporting Silver, Palladium and Platinum.
- Next resistance in Gold is seen towards 2458.80, but the Globe will be watching 2483.7 High Jul 17 and the bull trigger, not only the July high, but the record high.
