Asia’s gasoline refining margins GL92-SIN-CRK hovered slightly above $8 per barrel as ample supply expectations for January from northeast Asia continued to weigh, though some prompt buying interest limited weakness.
China-origin gasoline cargoes did surface into the market since yesterday, with most deals done at premiums of around 50 cents a barrel for January loading.
Some discussions for blendstock such as methyl acetate were ongoing but trading activity for other octane boosters remained muted due to a buy-sell gap for February shipments.
Weak gasoline-naphtha reforming margins and poor cash differentials for spot January material is still limiting demand and overall activity, according to one trading source.
Taiwan’s FPCC offered at least two 9,000 metric ton January-loading alkylated oil cargoes via a spot sales tender.
A portion of the market remained positive that demand outlets were still there, following talks of some supply disruption in the Middle East in the past two weeks which could last between one and two weeks.
Separately, several naphtha enquiries for February were still present in the spot market, but lower-priced sellers remained scant and this buoyed prices overall.
Premiums were likely at above $50 or more on a cost and freight (CFR) Asia basis linked to CFR Japan prices, given the emergence of February demand these two days, one source said.
Buyers in the open trading market further supported cracks NAF-SIN-CRK for the petrochemical feedstock, with sellers scant once crude futures were higher overnight.
Supplies remained curtailed due to limited arrivals from some parts of the Middle East and delays from the West, one trader said.
NEWS
– Half of Russia’s oil and petroleum exports in 2023 will have gone to China while India’s share has risen in two years to 40%, Russia’s state news agencies cited Deputy Prime Minister Alexander Novak as saying in remarks published on Wednesday.
– China’s November industrial profits posted double-digit gains as overall manufacturing improved, although soft demand continued to constrain business growth expectations, emboldening calls for more macro policy support.
– The United States has finalized contracts to purchase three million barrels of oil to help replenish the Strategic Petroleum Reserve (SPR) after the largest sale in history last year, the U.S. Department of Energy said on Tuesday.
– Oil loadings from Russia’s Black Sea port of Novorossiisk were suspended on Wednesday due to a storm, two sources familiar with the matter told Reuters.
SINGAPORE CASH DEALS
– Two gasoline deals, no naphtha deals.
INVENTORIES
– Light distillates stockpiles at Fujairah Oil Industry were little changed at 4.687 million barrels for the week ended Dec. 25, according to industry information service S&P Global Commodity Insights.
– Analysts in a Reuters poll estimated stockpiles of gasoline were up by about 400,000 barrels last week, and distillate stockpiles, which include diesel and heating oil, were seen increasing by about 1 million barrels.
Source: Reuters (Reporting by Trixie Yap; Editing by Krishna Chandra Eluri)