Asia’s middle distillates markets recorded a slew of February spot tenders as a handful of refiners continued to clear their requirements, while margins slipped to a near two-month low.
Offers stayed brisk, with South Korea’s GS Caltex continuing its sales in line with earlier expectations, though some traders are expecting February offers to be slightly fewer than January ahead of the refinery maintenance season.
At least one China refiner was also in discussion for some February cargoes, though further details could not be confirmed.
Meantime, Vietnam’s Petrolimex sought its February requirements ahead of the Lunar New Year holidays.
On the jet fuel front, several China-origin barrels continued to be discussed in the discounted territory for second-half February loading.
In paper markets, activity was mostly on inter-month swaps and tracking movements in the ICE gasoil markets, one trade source said.
As a result, refining margins (GO10SGCKMc1) came under pressure, slipping to around $14.6 a barrel, the lowest since early December.
Cash differentials (GO10-SIN-DIF) fell back below $1 a barrel, closing at nearly 95 cents premium a barrel amid the narrower backwardation on February and March paper swaps.
SINGAPORE CASH DEALS
– No deals for both fuels
INVENTORIES
– U.S. crude oil and fuel stocks rose last week, market sources said, citing American Petroleum Institute figures on Wednesday.
– Singapore’s middle distillates inventories edged down slightly as net exports of diesel/gasoil and jet fuel/kerosene both gained, official government data showed on Thursday.
REFINERY NEWS
– LyondellBasell Industries LYB will begin the permanent closure of its 263,776-barrel-per-day (bpd) Houston refinery this coming weekend, people familiar with plant operations said.
– Japan’s biggest refiner, Eneos Corp, shut the 129,000-bpd distillation unit (CDU) at its Chiba refinery near Tokyo on Wednesday for scheduled maintenance, a company spokesperson said on Thursday.
NEWS
– Australia’s Ampol ALD estimated a steep drop in annual earnings on Thursday as production at its Lytton refinery in Queensland was hit by operational constraints and lower refining margins.
– Middlemen supplying Russian oil are not offering cargoes due to new U.S. sanctions targeting Russian producers, tankers and insurers, according to the finance chief at Indian refiner Bharat Petroleum BPCL.
Source: Reuters