OIL PRODUCTS: China Nears Peak Gasoil Demand as LNG-Fueled Truck Sales Surge
Jun-26 2024 10:00
China either already has or is close to reaching peak gasoil demand as growing sales of LNG-fueled heavy-duty trucks displace diesel-powered equivalents, Platts said.
- The trend has already forced Chinese refineries to limit gasoil production in 2024 as LNG-fueled trucks have resulted in the displacement of 8% of gasoil consumption
- Platts expects China’s gasoil demand to see a marginal increase of 35k b/d, or 0.9% on the year at around 3.8m b/d in 2024, before peaking in 2027.
- Some analysts have seen China’s gasoil demand as already having peaked.
- Platts analysts also expect China’s LNG-fueled trucking fleet to expand is share of trucks to 10% of the total by end-2024, compared to 7.5% by end-2023.
- Refiners with Sinopec and PetroChina, as well as Shandong’s teapots said that their gasoil inventories were high due to falling demand.
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EGBS: /STIR: Goldman Sachs: Euro Area Recovery, Not Reflation
May-27 2024 09:53
Goldman Sachs write “despite the ongoing improvement in PMIs, we continue to think the European data set is consistent with policy easing.”
- “The improvement in both sentiment and hard data in the Euro area is being driven by ongoing relief in energy prices, a supply-side loosening that means the ECB has little to fear from the recent growth improvement.”
- “On the price front, although some measures of wage growth have ticked up, we think the broader trend of wage moderation is intact.”
- “The ECB’s wage tracker, more timely indicators such as Indeed job postings, and surveys all point in the right direction.”
- “Importantly the ECB had also anticipated a bumpy path in Q1 and share our more benign forward-looking outlook.”
- “In that set-up, we expect curve steepening into the start of the cutting cycle in June and think markets can price more cuts in 2025 in particular, as pricing of easing remains very cautious.”
- “We would also argue that while European rates continue to be exposed to US spillovers, the ongoing decoupling with EUR rates volatility has some room to run.”
OUTLOOK: Price Signal Summary - EUROSTOXX50 Pullback Considered Corrective
May-27 2024 09:45
- In the equity space, the uptrend in S&P E-Minis remains intact and the pullback last Thursday appears to be a correction. The contract also traded to a fresh cycle high that day, reinforcing a bullish theme. Recent gains signal scope for a climb towards 5372.73, a 1.764 projection of the Apr 19 - 29 - May 2 price swing. Initial support is 5259.02, the 20-day EMA.
- A bullish theme in EUROSTOXX 50 futures remains intact and the recent pullback still appears to be a correction. The contract has recently cleared 5079.00, the Apr 2 high, to confirm a resumption of the uptrend. This opens 5127.70 next, the 1.382 projection of the Jan 17 - Feb 12 - 13 price swing. Support at the 20-day EMA has been pierced. The next level to watch is 4955.70, the 50-day EMA.
EUROZONE ISSUANCE: Long 3-year EU-bond / Short 20-year Green EU-bond
May-27 2024 09:37
| 2.875% Dec-27 EU-bond | 1.25% Feb-43 Green EU-bond | |
| ISIN | EU000A3K4EW6 | EU000A3K4DG1 |
| Amount | E2.362bln | E2.027bln |
| Previous | E4bln | E1bln |
| Avg yield | 3.080% | 3.345% |
| Previous | 2.951% | 2.845% |
| Bid-to-cover | 1.91x | 1.09x |
| Previous | 1.93x | |
| Avg Price | 99.333 | 71.233 |
| Pre-auction mid | 99.320 | 71.172 |
| Prev avg price | 99.754 | 75.770 |
| Prev mid-price | 75.297 | |
| Previous date | 23-Apr-24 | 28-Nov-22 |
