Asia’s middle distillates markets ended the trading week on a quiet note, with a continued lack of window deals, though cash differentials on window and from April refiner sales gained significantly.
At least two northeast Asian refiners sold off April spot cargoes at slightly higher differentials from last month, mostly at flat or small premiums to free-on-board Singapore prices, multiple trade sources said.
Traders were mixed on forward demand-supply balances, given conflicting market drivers in the near-term such as a narrowing east-west price spread and thin spot buying interest.
Week on week, refining margins (GO10SGCKMc1) were little changed and closed at around $14.80 per barrel on Friday.
On the spot trading window, it was mostly quiet throughout the week, though a deluge of deals on Wednesday reflected a slight bearishness in trading sentiment. A buy-sell gap hindered discussions throughout the week.
Cash differentials (GO10-SIN-DIF) climbed week on week by more than 20 cents to close at 52 cents a barrel, though markets barely moved from the previous trading session.
Meanwhile, jet fuel activity was slightly muted given a closed arbitrage for Asian exports to the U.S. west coast and ample supplies from China.
Front-month regrade (JETREG10SGMc1) widened back to discounts of more than $1 a barrel, reflecting the general lack of movement in the jet fuel markets and some slight support from gasoil paper markets in the later trading session.
SINGAPORE CASH DEALS
– No deals for both fuels
INVENTORIES
– Gasoil and diesel stocks held in the ARA storage hub fell 5.4% to 2.37 million tons on slower imports and firmer regional demand.
REFINERY NEWS
– Marathon
MPC
will begin planned maintenance activities on units at its 255,000-barrel-per-day refinery in Robinson, Illinois on March 18, research company IIR and a source familiar with plant operations said on Thursday.
NEWS
– China customs data showed exports of refined oil products, which included diesel, gasoline, aviation fuel and marine fuel, were down 18% from a year earlier, at 7.21 million tons.
– Cosmo Energy Holdings is set to launch Japan’s first domestic production of sustainable aviation fuel in April, a step toward the country’s goal of replacing 10% of jet fuel with a cleaner alternative, though cost-cutting challenges remain.
– U.S. President Donald Trump’s administration is considering a plan to stop and inspect Iranian oil tankers at sea under an international accord aimed at countering the spread of weapons of mass destruction, sources familiar with the matter told Reuters.
– After a decade of false starts, Indonesia is rolling out a $1.5 billion project to distribute liquefied natural gas (LNG) on a small scale to feed dozens of power plants now running on diesel via a unique hub-and-spoke model across its vast archipelago.
– Saudi Arabia, the world’s top oil exporter, on Friday lowered crude oil prices for Asian buyers in April for the first time in three months, in line with market expectations and after OPEC+ agreed to gradually increase supply in the same month.
Source: Reuters