E/W retreats, allowing the AG to regain its landed value edge into East Africa
- The market has weakened from the rally seen earlier this week on the reported news of a Chinese export quota, with flat prices, spreads, and cracks weakening across the complex. In the prompt October swap, e/w has sold off to -$1.25/bbl, while November and December have both gained marginally to -$4.40/bbl.
- This is due in large part to reports that export activity in early October will be subdued during the holiday week, as well as reports that clearance issues, rather than a directive to halt refined product exports, had been the primary driver of export restrictions from China.
- Due to the correction in e/w prices, AG landed values into East Africa (Kenya and Tanzania) have been able to create some separation from European landed values. However, a key risk remains the potential for infrastructure impacts within the AG over the weekend from flare-ups in the conflict.
- Despite this weakening in SING92 paper prices as the market prices in additional supply, there have been continued gains in the higher-octane 95/92 differential for October, up to +$6.50/bbl.
- MTBE prices in the region have failed to gain alongside octane differentials, remaining generally flat over the week and allowing Singaporean blender margins to remain firm at +$2.00/bbl.
(AG reasserts landed values for early November delivery windows into Eastern Africa)
About the Author
Nikolas Plonski, our Oil Market Analyst for the Americas at Sparta, brings experience as a trader from Gent Commodity USA trading diesel and jet paper markets. Nikolas then joined Sparta, where he serves as a cross barrel analyst focused on the Americas.
Connect: LinkedIn
About Sparta
Sparta is the AI leader for commodity trading, home to Leonidas AI, the first decision-making engine for oil and commodity traders. Backed by USD 42 million in Series B funding led by One Peak, with participation from returning investors FirstMark and Singular, the same investors behind AI leaders like Legora, Dataiku, and Synthesia. From independents to multinationals, the world’s leading commodity teams use Sparta and Leonidas AI to move faster, trade smarter, and stay ahead of the market.
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