Asia’s middle distillates markets traded sideways, though front-month prices and timespreads held firm, while July discussions were active given strong selling interest from major regional exporters.
A slew of offers for spot diesel from South Korea’s oil majors surfaced for end-July loading shipments, with discussions underway.
Volumes seem to be slightly more than June shipments, two trade sources said, adding that it could be due to sellers wanting to capitalise on current healthy refining margins.
Meanwhile, jet fuel offers from some of China’s exports were also available.
On the arbitrage front, the export window for Asian jet fuel to the U.S. west coast region turned slightly open in the past two trading sessions with some discussions for mid-July sales there.
Demand was upbeat from some regions such as Vietnam, with a major fuel importer seeking spot prompt deliveries given better-than-expected local offtaking activity.
Traders were waiting to see if there would be a clear outcome on any fresh sanctions or regulations for the users of Russian oil, given the meeting in the EU which could indirectly shift Asian supply-demand balances.
Physical spot activity for both diesel and jet fuel on the trading window stayed muted, with both bids and offers equally scant.
The 10ppm sulphur gasoil cash differentials (GO10-SIN-DIF) gained in tandem.
Regrade (JETREG10SGMc1) narrowed further to around discounts of $1.65 a barrel, reflecting the slight firmness in jet fuel markets
SINGAPORE CASH DEALS
– No deals for both gasoil and jet fuel
INVENTORIES
– U.S. crude oil and fuel inventories fell last week as refining activity and demand rose, the Energy Information Administration (EIA) said on Wednesday.
– Singapore’s middle distillates inventories declined to slightly above 10 million barrels as net exports climbed week on week, official data showed on Thursday.
REFINERY NEWS
– Venezuela’s state-run PDVSA was on Wednesday restarting several operational units at its 310,000-barrel-per-day Cardon refinery, the country’s second largest, following a power blackout that halted the facility earlier this week, two sources said.
NEWS
– Refineries in Vietnam are not being affected by the tensions in the Middle East at the moment, the Ministry of Industry and Trade said on Thursday.
– President Donald Trump said on Wednesday that the U.S. has not given up its maximum pressure on Iran – including restrictions on sales of Iranian oil – but signaled a potential easing in enforcement to help the country rebuild.
– Oil prices were steady on Thursday after erasing earlier gains as investors remained cautious about the Iran-Israel ceasefire while also shifting focus to market fundamentals.
Source: Reuters