Asia’s 10ppm sulphur gasoil refining margins breached the $21-a-barrel level for the first time since end-March, as prompt buying in the paper swaps market stayed strong against a backdrop of softer crude prices.
“Middle distillates continue to be supported by falling inventories in the ARA region, whilst Singapore middle distillate stocks are broadly in line with the low levels seen last year,” ING analysts said in a client note.
Spot differentials GO10-SIN-DIF hit a three-day high of $1 a barrel, supported by one oil major and one key trading house buying spot lots in the open market.
However, spot sellers for August-loading cargoes were still readily available in the spot market, both on open trading and tender fronts, capping overall gains.
Jet fuel refining margins JETSGCKMc1 gained at a slower pace, with a portion of participants were still cautious about overall jet fuel demand in the region, given slowdowns in offtaking in some southeast Asian countries including Thailand in the May-June period, two trading analysts said.
Regrade widened further to a discount of $1.85 a barrel as a result of this gasoil strength and cautiousness on jet fuel.
SINGAPORE CASH DEALS O/AS
– One gasoil deal, no jet fuel deal.
INVENTORIES
– U.S. gasoline stocks fell by 1.1 million barrels in the week to 218.4 million barrels, the EIA said, while distillate stockpiles, which include diesel and heating oil, rose by only 14,000 barrels in the week to 118.2 million barrels.
– Middle distillates stocks in key trading hub Singapore were almost steady as a rise in jet fuel/kerosene outflows counteracted a 36% surge in gasoil imports amid the emergence of Oman-origin cargoes, official data showed on Thursday.
NEWS
– China’s imports of crude oil from Russia hit an all-time high in June, Chinese government data showed on Thursday, with refiners continuing to snap up discounted Russian ESPO even as discounts against international benchmarks narrow.
– Marathon Petroleum Corp MPC.N began restarting the resid hydrotreater (RHU) on Wednesday at its 593,000 barrel-per-day (bpd) Galveston Bay Refinery in Texas City, Texas, said people familiar with plant operations.
– China’s June fuel oil imports hit the highest level for a month so far in 2023, buoyed by firm purchases of Russian oil, data from the General Administration of Customs showed on Thursday.
Source: Reuters (Reporting by Trixie Yap; Editing by Varun H K)