Asia’s cash premiums for spot July cargoes recovered slightly to 64 cents a barrel on Monday, after hefty losses the previous session, reflecting some second-half July demand despite an overall muted market and few offers.

A portion of the market was still digesting news of the Chinese government implementing a consumption tax on diesel blendstocks such as white oil, although a handful of participants said the new rules have been factored into price movements since May.

Local wholesale prices of diesel and gasoline were both firmer from the previous trading session by at least 50 yuan per metric ton.

Refining margins were lower and slightly below $17 a barrel, with market liquidity hampered by a lack of clarity on August fundamentals against a backdrop of weaker gasoil futures.

Jet fuel refining margins fell at a slower pace, to around $15.80 a barrel, as evidenced by the rise in paper swap prices, with the market turning back into a backwardated structure.

Also, regrade narrowed further to almost $1.10 a barrel, reflecting the weaker performance in the gasoil paper swaps market.

SINGAPORE CASH DEALS

– No gasoil or jet fuel deals

TENDERS

– China’s WEPEC sold three spot July-loading jet fuel, up from two cargoes for June loading

REFINERY NEWS

– Kuwait Integrated Petroleum Industries Company (KIPIC) put out a fire at the al-Zour refinery without any reported injuries, a company spokesperson said on Monday.

NEWS

– Indian state fuel retailers’ gasoil and gasoline sales in June were little changed from the previous month, preliminary data showed, as people avoided travel as a heat wave in May gave way to monsoon rains.

– Asian refiners expect Saudi Arabia to lower prices for its crude supply to the region in August, a Reuters survey showed, even as the top oil exporter pledged to deepen production cuts in July as part of a broader OPEC+ deal.

– China announced late on Friday that a series of fuel-blending components would be subject to a consumption tax with immediate effect, according to a joint statement of the Ministry of Finance and the State Taxation Administration.

– Oil slipped on Monday as concerns about a global economic slowdown and possible further interest rate hikes from the U.S. Federal Reserve weighed on prices, offsetting forecasts of tighter supplies and OPEC+ output cuts. O/R

– China’s factory activity growth slowed in June, a private sector survey showed on Monday, with sentiment waning and recruitment cooling as firms grew increasingly concerned about sluggish market conditions.
Source: Reuters (Reporting by Trixie Yap; Editing by Savio D’Souza)