Asia’s middle distillates markets saw a flurry of spot activity for June shipments this week, though window cash differentials slipped on Friday amid a weaker derivative market structure.
The 500ppm sulphur gasoil markets saw a slight uptick in spot activity and overall buying interest, especially within the northeast Asia region, multiple trade sources said.
Demand support came from low-sulphur marine gasoil markets, especially from China, given the stronger profit margins from procuring U.S.-denominated cargoes compared with yuan-denominated cargoes.
Supplies came in the form of Taiwan- and South Korea-origin barrels, with at least five cargoes being sold by refiners at discounts averaging slightly more than $1 a barrel.
Jet fuel wise, the Asia-U.S. west coast arbitrage price spread remained barely open and was not very profitable for traders, with most Asian cargoes to flow within the region for now.
Refining margins (GO10SGCKMc1) remained at nearly $17 a barrel, little changed from the previous trading session.
On the trading window, lower-priced offers were both readily available for jet fuel and 10ppm sulphur gasoil, weighing on cash differentials for both products.
The 10ppm sulphur gasoil cash differentials (GO10-SIN-DIF) slipped to premiums of 63 cents per barrel, a three-week low.
Regrade (JETREG10SGMc1) widened to around 85 cents a barrel as June gasoil paper markets traded higher than the past few sessions.
SINGAPORE CASH DEALS
– No deals for both fuels
INVENTORIES
– Gasoil stocks independently held in the Amsterdam-Rotterdam-Antwerp refining and storage hub, which include diesel, were higher by 6% at 2.22 million tons on higher cargo imports from the Middle East.
NEWS
– U.S. oil producer Chevron Corp CVX and several European companies are in talks with the Trump administration to obtain authorizations to keep their stakes in joint ventures with Venezuela’s state-run PDVSA, three sources close to the matter said.
– A U.S. and biofuel coalition recommended that the Environmental Protection Agency propose federal mandates for biomass diesel blending for 2026 at 5.25 billion gallons, which would be a significant increase from previous mandates, two sources familiar with the matter said.
– Black Sea CPC Blend crude oil exports are pencilled in at around 1.6 million-1.7 million barrels per day in June, five trading sources with knowledge of the month’s loadings told Reuters.
Source: Reuters