Asia’s spot market premiums for 10ppm sulphur gasoil climbed further to a two-month high at 70 cents a barrel despite thinner liquidity day on day, as prompt buying interest stayed firm in the open trading market.

No offers were available in the afternoon trading session, supporting premiums further – although more refiners came out with July-loading tenders, taking the cue from South Korea, as Taiwan’s Formosa Petchem issued their second tender to sell 10ppm cargoes in a week.

Refining margins for the fuel firmed slightly to almost $17 a barrel, with some support coming from tighter prompt supply expectations amid volatile crude futures, two analysts said.

Jet fuel refining margins were little changed amid concerns about China’s demands were prevalent and some arbitrage demand continuing from the West.
“Overall weakness in economic conditions is keeping kerosene prices subdued, and recent trends in China are raising concerns of the true potential of its fourth quarter demand recovery,” said StoneX energy analyst Harry Altham in a client note.

Regrade (JETREG10SGMc1) narrowed slightly to a discount of 93 cents a barrel.

SINGAPORE CASH DEALS

– No gasoil or jet fuel deal.

INVENTORIES

– U.S. crude oil stockpiles were expected to have fallen last week, while distillate and gasoline inventories were seen up, a preliminary Reuters poll showed on Monday.

NEWS

– Pakistan paid for its first government-to-government import of discounted Russian crude oil in Chinese currency, the South Asian country’s petroleum minister said on Monday, a significant shift in its U.S. dollar-dominated export payments policy.

– Oil prices traded up on Tuesday on bargain hunting, recovering some ground from the previous day’s plunge, but gains were limited as investors remained cautious ahead of key policy decisions by the U.S. Federal Reserve and other central banks.
Source: Reuters