Asia’s middle distillates markets were thinly discussed after yesterday’s flurry of activity, with the front-month east-west remaining narrow though ICE gasoil futures continued the uptrend.
Traders were eyeing offers from China refiners to emerge soon, given that it was past mid-month and April sales activity should start soon.
Export estimates for April-loading diesel from China were similar to March at around 400,000 metric tons, while jet fuel volumes were around 2.2 million tons in total.
Refining margins slipped for a second straight session this week to around $13.30 a barrel amid a late afternoon crude market surge.
Window activity stayed thin, with a lack of bids for 10ppm sulphur gasoil.
Cash differentials closed the trading session 3 cents lower, tracking a narrower backwardation in April-May paper timespreads.
Meanwhile, for jet fuel, the arbitrage spread between Asia and the U.S. West Coast widened significantly since the previous trading session, with traders expecting some discussions to emerge soon, given its profitability.
Regrade for April was however little changed at discounts of around $1.2 a barrel.
SINGAPORE CASH DEALS
– No deals for both fuels
INVENTORIES
– U.S. crude oil stockpiles were expected to have risen last week, while distillate and gasoline inventories likely fell, a preliminary Reuters poll showed on Monday.
NEWS
– Only one tank filled with jet fuel was damaged after the U.S. military-contracted tanker that was transporting a shipment was struck by a cargo ship off England’s northeast coast, U.S. logistics firm Crowley said.
– Venezuela’s state-run PDVSA has put together three operational scenarios as part of a plan to continue producing and exporting oil at its largest joint venture with Chevron CVX.N once a license for the U.S. major to operate in the country expires next month, according to a company document seen by Reuters on Monday.
– Chevron bought about 4.99% of Hess Corp’s common shares this year, reflecting its confidence in completing the planned acquisition of Hess, the oil giant said in a regulatory filing on Monday.
– Oil prices rose more than 1% on Tuesday to their highest levels since the beginning of the month, supported by instability in the Middle East as well as China’s plans for more economic stimulus.
– Yemen’s Houthis will not “dial down” their action against Israeli shipping in the Red Sea in response to U.S. military pressure or appeals from the group’s allies such as Iran, the Yemeni militant group’s foreign minister said.
Source: Reuters