Mon 5Nov2018: Gasoil sitting now on 200DMA @682 ahead of US midterms while Nov to April backwardation nearing $18/MT while RSI in low 50’s. Although Gasoline crack well below $10/brl, we note that Heating Oil crack remains at $29/brl enabling 3:2:1 to still print $14.90/Brl. US Biodiesel margins have improved only slightly thanks to improved RINs value at 36 cpg while BOHO has narrowed significantly with the engineered big drop in flat price of diesel ahead of elections in US. BOGO has improved at least $13/MT while EU premium, particularly in RME, show improvement beyond such consideration now trading spot close to +600 while Q4 still showing values of +485. FAME on the other hand is trading at 435 discount to RME in the spot and 325 discount for Q4. More meaningful is that the back of the curve on FAME is showing very depressed value for q1 at +150 which does not make any sense considering that even POGO has improved at least $50/MT in 2 weeks. On the FOREX side CNH has remained stable @6.91 despite the very acrimonious trade discussions. INR has stabilised after the big drop in crude these last 2 weeks before US elections. We can expect that post elections and Iran sanctions, there will be little to hold down crude prices.

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