South Korea’s SK Energy has issued a tender to sell February-loading gasoil cargoes after cancelling its jet fuel tender, several sources close the matter said on Thursday.

This move was attributed to a widening regrade value, also known as the discount between jet fuel and 10 ppm sulphur gasoil, that makes producing gasoil more profitable than jet fuel, they added.

Also, SK Energy had received lower-than-expected bids for the jet fuel tender a day earlier, they said.

The prompt month regrade (JETREGSGMc1) closed the trading session at minus $2.40 a barrel, widest in three weeks, Refinitiv Eikon data showed.

The tender for the three 10 ppm sulphur and three 500 ppm sulphur gasoil cargoes, all loading in February, closes on Jan. 12.

Bids have to be valid until the evening of Jan. 12.

The refiner previously sold January-loading jet fuel and 10 ppm sulphur gasoil at a premium of $2 a barrel and a premium of around $1 a barrel to Singapore quotes.

SK Energy could not be immediately reached for comment.
Source: Reuters