Trade with Conviction

Felipe Elink-Schuurman, Neil Crosby, and Jorge Molinero on the crisis shifting West. Neil unpacks a 25-million-barrel US stock draw and trade ideas across Hogo, regrade, and diesel cracks. Jorge covers gasoline East-West flows and the US TAR opening.

Chapters: 

(01:20) Big picture: Iran war and the physical reset US drew 25 million barrels in one week. Neil explains why physical isn't pricing max pain yet.

(07:38) East to West: how the crisis is shifting Asia absorbed the initial shock. The US is now the story, swinging from net importer to net exporter.

(15:43) Gasoline: East-West collapse and the ARA arb Felipe and Jorge debate East-West recovery as Singapore becomes cheapest gasoline into more destinations.

(21:47) US gasoline TAR: the arbitrage is opening Net imports at seven-year lows. The ARA-to-PAD1 arb is cracking open for the first time in months.

(30:50) Middle distillates: Hogo, regrade, and deferred diesel cracks Neil makes the case for three distillates trades as US stocks approach historical lows.

(37:02) Crude: TI Brent, Brent diffs, and the flat price view TI Brent still looks like a buy. Brent physical diffs may run lower short-term.

Felipe Elink-Schuurman and June Goh cover the FT Commodities conference, where major trading house CEOs signalled no short-term resolution to Hormuz. June runs through crude premium collapse, EU sanctions, and a bullish fuel oil case into Q3.

Chapters: 

(01:04) FT Conference: No deal in sight, Russia backing Iran CEOs of Trafigura, Vitol, Mercuria and Gunvor: no short-term resolution. Mercuria's Dunand: Russia is backing Iran.

(10:20) Headlines: Hormuz stays shut and airlines start cancelling flights Ceasefire extended but Hormuz stays shut. IRGC firing on vessels. Lufthansa cancels 20,000 summer flights.

(17:11) Crude: Premiums drop $11 as China sells West African barrels Forties premiums down $11. China selling West African barrels into Asia while tapping SPR for state refiners.

(22:02) Distillates: HOGO squeeze and the East-West tug of war US diesel at five-year lows keeps HOGO supported. East-West stuck at minus 35-40 but Europe-Asia barrel fight looms.

(27:31) Gasoline and naphtha: EPA waivers, the Atlantic shift and East-West collapse Europe now cheapest into Mexico as Houston tightens. Naphtha East-West at war lows but a rebound looks likely.

(34:48) Fuel oil: Singapore tightens and Q3 VLSFO cracks are a buy Russian fuel oil propping up Singapore is set to dry up. June calls Q3 VLSFO cracks at $11 a buy.

Host Neil Crosby talks with June Goh and Michael Ryan about a week of conflicting signals on Iranian vessels, accelerating refinery run cuts across Asia, and the secondary unit squeeze nobody's talking about. The team unpacks why a peace deal wouldn't fix markets overnight, how freight rates could spike if tankers can't reposition in time, and where the real pricing action is in diesel and gasoline.

Chapters: 

 

(00:46) The blockade is here, but what does it actually mean?

Neil opens with the state of play after the failed peace talks, the conflicting signals on which ships are getting through Hormuz, and why owners still don't have enough clarity to act.

 

(04:16) Even with peace, the supply chain is broken.

June explains why a deal wouldn't fix the market overnight, with three to six months needed to rebuild logistics and reposition the VLCCs that have scattered to the US Gulf Coast.

 

(06:14) Asian run cuts and SPR draws are accelerating.

The team breaks down Japan's 68% utilization rate, Singapore's 50–60% runs, and China's reluctant move to tap strategic reserves.

 

(15:33) The secondary unit squeeze nobody's talking about.

June walks through how lower medium sour availability cascades through VGO, hydrocrackers, FCCs, and short residue units, and why Singapore bunker fuel production is at risk.

 

(22:25) What happens to AG freight if peace lands?

Michael lays out the scenario where a deal triggers a selloff in AG paper, but a shortage of repositioned tankers could cause rates to spike again weeks later.

 

(25:50) Diesel and gasoline: where the real pricing action is.

The team covers the surprise weakness in Singapore diesel, the divergence in gasoline cracks between East and West, and what it means for arb economics heading into May.

The ceasefire is two days old. Nothing has changed on the water.

Sea mines in the channel. IRGC still threatening vessels. No owners willing to move. Hormuz flows stuck below 50% for at least another month.

Paper sold off hard on the headlines. Already rebounding. Physical premiums at records across crude, naphtha, and diesel. Every risk-off dip is looking like a buying opportunity.

Chapters: 

(00:43) Ceasefire reality check

Neil sets the scene: day two of the ceasefire, sea mines in the Strait, IRGC threats to shipping, and why a tollbooth system under Iranian control is likely the only short-term path to restoring flows.

(05:02) Saudi infrastructure under fire

Phil flags attacks on the East-West pipeline and unconfirmed reports near Abqaiq, raising questions about whether rerouted Saudi crude is really safe even during a ceasefire.

(06:56) Demand destruction: price-led vs policy-led

The team maps out a two-tier system where Asia faces price-driven run cuts while Europe may need policy intervention to bring consumption down without crushing the economy.

(08:36) US oil stocks: building when they should be drawing

Neil and Phil unpack why US commercial stocks are still building despite record export economics, and what SPR releases and April WTI loadings could change.

(12:09) Light ends: paper sell-off, physical strength

Jorge breaks down the $5/bbl gasoline and $40/mt naphtha corrections on East-West, why physical premiums are at record levels across all regions, and where the ARB opportunities sit.

(17:38) Crude physicals: diffs still climbing

Phil covers North Sea DFLs holding firm, West African diffs hitting new records, Aramco OSPs for May, and why Mars and Arab Light are landing at similar levels into the Far East.

(20:00) Margins and the global run cut question

The team discusses why refining margins in both Asia and Europe are under pressure, Japan's utilisation dropping into the 60% range, and how the marginal barrel economics are starting to force the run cuts the market needs.

(22:47) Distillates: risk-off noise vs physical reality

Phil walks through the $15/bbl crack correction on ceasefire headlines, why diesel East-West barely moved versus jet, and why the strongest incentive remains moving diesel to Asia as fast as possible.

In this episode of Trade with Conviction, Felipe, Phil, and James break down the supply crisis rattling every product market, and where traders can find edge right now.

Chapters
(00:17) Geopolitics: The Hormuz Standoff

Felipe and Phil debate whether anything has really changed, Trump's contradictory messaging to markets, Israel, GCC and Iran simultaneously, the UAE's UN letter invoking Article 7 to reopen Hormuz, and why the how of ending this conflict matters far more than the when.

(10:12) Supply Reality Check: 10mb/d Gone, Plan Bs Burning Fast

Phil runs the brutal arithmetic: 10mb/d lost, SPRs and demand destruction covering maybe 3-4mb/d at best. James walks through Asian governments scrambling — Japan and South Korea tapping SPRs, Southeast Asia mandating work-from-home, Australia tweaking diesel specs. The oil-on-water buffer is largely gone.

(20:25) Gasoline: Choppy, Not the Story

Felipe explains why gasoline is a slow burner right now — the US Jones Act waiver and RVP spec change making America self-sufficient, Dangote running full in West Africa, and European ARBs too choppy to capture. Phil flags the TA ARB turning positive and makes the case for a May E-Bob crack. The real call: June or Q3.

(29:22) Diesel & Jet: A Market in Meltdown

James unpacks the numbers that stopped the room. Singapore diesel spreads doubling from $25 to $70/bbl overnight, gasoil East-West exploding from $100 to $400/tonne in days. Every conventional resupply route into Europe is closed. Ryanair is already flagging flight cancellations. The only fix is demand destruction, and we're not there yet.

(40:18) Freight: Good Time to Be a Ship Owner

Phil closes with the Atlantic freight picture, Gulf Coast supply lists tightening without a corresponding export surge, TC2 finally joining the rally, and why vessel owners are the quiet winners of the crisis.