Asia’s middle distillates’ market activity was mostly muted amid slow trading momentum on the last trading day of June as traders awaited a clearer supply-demand direction next month.
Traders were also looking for clues on August supply availability, given that some refiners are likely to start their August spot sales towards the end of this week.
Meanwhile, on the arbitrage front, the diesel east-west price spread continued trading at discounts narrower than $30 per metric ton, while freight costs on the South Korea-UKC route remained around $40 per ton for a long-range vessel.
Refining margins (GO10SGCKMc1) extended losses for a second session, closing at $18.5 a barrel, erasing some of the war risk premiums in the past two weeks.
On the trading window, discussions were almost non-existent and diesel cash differentials (GO10-SIN-DIF) held its ground at premiums of $1.14 a barrel.
Jet fuel discussions were equally minimal, as traders sought a direction from the West given overall unchanged regional demand fundamentals and volatile arbitrage price spreads with the US and Europe since a week earlier.
July regrade (JETREG10SGMc1) widened further to discounts of $1.85 a barrel, reflecting the slightly weaker performance in jet fuel markets.
SINGAPORE CASH DEALS
– No deals for both fuels
REFINERY NEWS
– Israel’s Oil Refineries ORL said on Sunday it had partly resumed activities at its Haifa facility, which was shut down following an Iranian missile strike two weeks ago.
NEWS
– California’s energy regulator on Friday recommended new rules to encourage more private investment in fuel imports and a pause on refiner profit limits, hoping to stop gasoline prices from skyrocketing in the state as it braces for the closure of two of its major refineries.
– The world’s largest group of oil producers, OPEC+, is set to announce another big increase of 411,000 barrels per day in production for August as it looks to regain market share, four delegates from the group told Reuters.
– China’s manufacturing activity shrank for a third straight month in June, though at a slower pace, as increases in new orders, purchasing volumes and supplier delivery times signalled that policy support rolled out since late last year is taking effect.
– Oil prices fell on Monday as an easing of geopolitical risks in the Middle East and the prospect of another OPEC+ output hike in August improved supply expectations amid persistent uncertainty over the outlook for global demand.
– A heat wave in western Europe has lowered water levels on Germany’s Rhine River, hampering shipping and raising freight costs for cargo owners due to additional surcharges as their vessels were unable to sail fully loaded, commodity traders said on Monday.
Source: Reuters