Asia’s middle distillates markets kicked off the week at a slower trading pace, with some traders away for regional holidays, despite some prompt month paper demand still present and July discussions expected to pick up soon.
Markets were waiting for at least three northeast Asian refiners to start their July loading offers this week, sources said.
Refining margins hit a one-month high, supported by the stronger paper market discussions for prompt month prices – likewise the upward movements in ICE gasoil futures in the afternoon trading window.
However, spot market discussions continued to hover in the discount trajectory, but a buy-sell gap and overall thin liquidity in the open trading window hampered deals and discussions.
Discounts steepened back to nearly 20 cents a barrel as the contango widened in the paper market in the open market trading session.
Meanwhile, on jet fuel, some spot demand emerged from key importer Indonesia for both end-June and July cargoes of up to 800,000 barrels, providing support for demand.
Regrade closed the trading session almost stable at a discount of around $1.10 a barrel.
SINGAPORE CASH DEALS
– One 500ppm gasoil deal, no jet fuel deal.
NEWS
– Iraq’s Oil Minister Hayan Abdel-Ghani said there has been progress in talks with Kurdistan region officials and representatives of international companies operating there for a deal to resume oil exports via a pipeline to the Turkish port of Ceyhan.
– Diesel fuel prices in much of Malaysia are set to rise by roughly 50% on Monday as the government begins shifting away from costly blanket subsidies to a targeted approach that mainly helps the needy.
– President Joe Biden’s administration said on Friday it has increased purchasing of crude oil to replenish the Strategic Petroleum Reserve following its historic sale from the stockpile in 2022.
– Oil prices edged up on Monday, aided by hopes of rising fuel demand this summer, although a firmer dollar boosted by lower chances of imminent interest rate cuts capped gains.
Source: Reuters (Reporting by Trixie Yap; Editing by Ravi Prakash Kumar)