Pakistan Oil & Gas_Refining cracks following crude swings, (AKD Daily, Mar 30, 2021)
AKD Daily
Pakistan Oil & Gas: Refining cracks following crude swings
- POL product cracks for first-half Mar’21 (14 trading days 25th Feb-11th Mar) remained mixed - where for HSD (largest refining segment, 46%/44% of 1QFY21/FY20 output), cracks declined to US$3.62/bbl despite underlying crude benchmarks inching higher (Arab Light during the period average at US$65.5/bbl up 4.0% over previous 14 days) on the back of increasing COVID-19 related uncertainty.
- HSD crack to Arab Light averaged US$+3.62/bbl remaining above 8MFY21 avg. of US$2.7/bbl but well below 8MFY20 of US$9.1/bbl, while the same measure for MS RON92 was considerably better (US$3.6/bbl avg over period), remaining above 8MFY21 avg. of US$1.7/bbl
- HSFO cracks continue to operate in the red, standing at US$-9.3/bbl (vs. 8MFY21 avg of US$-5.8/bbl), with conclusion of winter season resulting in lower FO-based power demand while Asian HSFO supply also increased as refinery run rates improve with vaccination going on in full pace in middle east.
- Concerns over worsening COVID-19 situation in Europe has resulted in crude benchmarks slipping with Arab Light down by 4.5% to US$62.4/bbl against average of US$65.3/bbl for first week of Mar’21 however improving vaccine access in US driving pent-up driving demand which is visible in cracks for RON92 improving against a decline in HSD/HSFO cracks. Moving forward, we expect the same to continue where risks from amore viral COVID-19’s strains could instill downsides.
AKD Research
Co. and its subsidiaries are principally engaged in the exploration, drilling, production and sale of crude oil and gas and other products.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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