Asia’s middle distillates markets on Monday were trading at a slow pace on the window, though derivatives markets were firmer, with traders eyeing some July refiner spot sales to start this week.
July sales activity will likely surface in the late week as some refiners start offering their regular requirements, with traders expecting volumes to be similar to June shipments as the refinery maintenance season gradually comes to an end by this month.
Meanwhile, some demand replenishment activity for both second-half June gasoil and jet fuel cargoes was ongoing late last week given supply outages in northeast Asia. Further details could not be confirmed.
The onset of the monsoon season in some regions including a portion of southeast Asia and India could ultimately weigh on demand starting end-June and July, several trade sources said.
Talks of more east-west arbitrage flows for jet fuel also emerged for June, with some traders expecting at least 4-5 long range-sized vessels to have been chartered from northeast Asia.
On the trading window, activity was mostly evident for 10ppm sulphur gasoil with cash differentials (GO10-SIN-DIF) gaining to 37 cents a barrel given a lack of lower-priced offers.
Meanwhile, the 10ppm sulphur gasoil refining margins (GO10SGCKMc1) inched up slightly to around $16 a barrel reflecting paper market gains in the afternoon.
Front-month regrade (JETREG10SGMc1) continued to hover at discounts of slightly above $1 a barrel.
SINGAPORE CASH DEALS
– One gasoil deal, no jet fuel deal
NEWS
– Nigeria’s Dangote oil refinery will import at least five million barrels of U.S. WTI crude oil in July, three trading sources told Reuters, extending its buying spree after a potential record tally for June.
– The International Air Transport Association said on Sunday it expects the amount of sustainable aviation fuel produced to double in 2025 to reach 2 million tonnes, representing 0.7% of airlines’ fuel consumption.
– The world’s largest group of oil producers, OPEC+, stuck to its guns on Saturday with another big increase of 411,000 barrels per day for July as it looks to wrestle back market share and punish over-producers.
– Oil prices jumped by about 3% on Monday after producer group OPEC+ kept output increases in July at the same level as the previous two months.
Source: Reuters