Middle distillates stock levels held at key trading hub Singapore have rebounded and were close to 8 million barrels as the pace of exports slowed and more imports flowed in, official data showed on Wednesday.
Inventories of gasoil and jet fuel/kerosene were at 7.98 million barrels (1.071 million metric tons) in the week ended June 27, down from 7.732 million barrels a week ago, the data from Enterprise Singapore showed.
Total imports of gasoil rose, while total exports of both gasoil and jet fuel/kerosene fell about 50% week on week.
Cargoes from South Korea and Taiwan entering Singapore resumed after a hiatus of a week, contributing to the higher total gasoil imports.
Traders are expecting more spot gasoil to flow to Singapore for July deliveries, given the rise in supply after the spring refinery maintenance season ends and a lack of demandin the region and the West, with some South Korean refiners still selling spot lots as of this week.
China-origin gasoil arrivals in Singapore could also resume again in July as refiners start cashing in on better export margins from a week earlier, traders and analysts say.
“In China, gasoil demand will face obstacles in 3Q 2023, as the ongoing real estate crisis and heavy rainfall during the monsoon season will hinder construction activities. Along with the return of refineries from spring maintenance, this should widen the country’s gasoil surplus,” FGE analysts said in a note.
On the export front, cargoes were mostly bound for regional destinations again – with the exception of the United States.
Below are the top export contributor countries for gasoil in the week and their respective volumes (in metric tons):
Jet fuel exports remained the key focus, with volumes mostly still bound for southeast Asia and the Pacific region.
Arrivals into Singapore could be minimal in the near-term as sellers seek better marginselsewhere in the West, given better margins to regions such as the U.S. West Coast, two Singapore-based traders said.
Source: Reuters (Reporting by Trixie Yap and Matthew Chye; Editing by Robert Birsel)