Asia’s middle distillates markets stayed firm, with sentiment remaining upbeat by the ongoing conflicts in the Middle East, while July spot activity in the region started to regain momentum.
ICE gasoil derivatives remained on an upward trajectory, gaining almost 4% day on day, in line with crude markets and freight markets.
Firmness in Asian markets was further attributed to some front-month buying activity from some southeast Asian importers for both jet fuel and gasoil.
A handful of market participants were awaiting more July offers to emerge for China-origin barrels to have a better gauge on fundamentals, with some 10ppm sulphur gasoil cargoes done at 10-20 cents discount to free-on-board Singapore prices either late last week or early this week.
Some weaknesses in jet fuel markets remained, with traders saying that supplies for the aviation fuel were ample going into July as well.
Refining margins extended gains to slightly more than $18 per barrel, but levels remained shy of one-year high milestones.
On the trading window, deals resurfaced for the first time in two sessions at higher levels, pushing cash differentials (GO10-SIN-DIF) to 83 cents a barrel.
Regrade (JETREG10SGMc1) continued trading in discounts of slightly more than $1.40 a barrel.
SINGAPORE CASH DEALS
– Two gasoil deals, no jet fuel deal
INVENTORIES
– U.S. crude oil and distillate stockpiles were expected to have fallen, while gasoline inventories likely rose last week, a preliminary Reuters poll showed on Monday.
REFINERY NEWS
– Japan’s largest refiner, Eneos Corp, restarted the 77,000-barrel-per-day No. 3 crude distillation unit at its Kawasaki refinery near Tokyo on June 5, following an unplanned shutdown the day before, a company spokesperson said on Tuesday.
– BP’s BP. 250,000-barrel-per-day Cherry Point refinery has completed a major turnaround, the company said on Monday.
NEWS
– Electronic interference with commercial ship navigation systems has surged in recent days around the Strait of Hormuz and the wider Gulf, which is having an impact on vessels sailing through the region, naval forces said on Monday.
– The Dangote Oil Refinery in August will begin directly supplying fuel to retail stations, manufacturers, telecoms firms and other large users, a move that could enhance supply but puts it in direct competition with local fuel traders.
– The United Arab Emirates coast guard said on Tuesday it had evacuated 24 people from the oil tanker ADALYNN following a collision between two ships in the Gulf of Oman, near the Strait of Hormuz.
Source: Reuters