Asia’s middle distillates markets turned slightly upbeat, with the emergence of open window deals and some paper trades going on, though refiner sales for January cargoes did slow down slightly.
Refiner sales remained mostly in discounted territory, including for China-origin barrels, given the recent lack of new demand drivers, trade sources said.
Markets were also seeking clarity on China-origin barrels for January shipments, given the earlier decline in tax rebates for oil majors that could increase flexibility in the type of exports.
Jet fuel exports will likely have the best margin advantage for now, so refiners may choose focus on these volumes, one China-based trade source said.
One key exporter in east China was seemingly offering a January jet fuel spot cargoes via private negotiations, but further details could not be confirmed.
Meanwhile, 10ppm sulphur gasoil refining margins (GO10SGCKMc1) closed the trading session at slightly below $16 a barrel.
Cash differentials (GO10-SIN-DIF) for the fuel continued to gain for a second straight session to premiums of around 74 cents a barrel, as robust buying interest took centre stage from BP.
Regrade (JETREG10SGMc1) widened further to around a discount of $1.65 a barrel, as worries of rising supplies remained a key focal point for some players.
SINGAPORE CASH DEALS
– One 10ppm gasoil deal, no jet fuel deal
INVENTORIES
– U.S. crude oil and fuel stockpiles are expected to have fallen last week, a preliminary Reuters poll showed on Monday.
NEWS
– Chinese authorities have agreed to issue 3 trillion yuan ($411 billion) worth of special treasury bonds next year, two sources said, which would be the highest on record, as Beijing ramps up fiscal stimulus to revive a faltering economy.
– Oil prices rose on Tuesday, reversing the prior session’s losses, buoyed by slightly positive market outlooks for the short term and stronger U.S. economic data, despite thin trade ahead of the Christmas holiday.
– India’s crude oil imports rose 2.6% year-on-year to 19.07 million metric tons in November, government data showed on Monday.
Source: Reuters