Asia’s middle distillates markets remained upbeat, with a slew of physical deals on window evident and Vitol being the key buyer, though sales from northeast Asian refiners for December spot cargoes remained scant and price fluctuations were minimal.
Traders were still waiting to see whether spot sales will start emerging from the handful of northeast Asian refiners and if volumes will change month on month, though China volumes are expected to remain curtailed.
Concerns about swing supplies heading over to Asia remained, given the limited east-west arbitrage profitability for refiners.
Overall, the region’s supply losses from planned refinery maintenance for the first quarter next year is likely to be lighter year on year, one trade source said.
Meanwhile for jet fuel/kerosene, Japan’s imports for December are likely to remain elevated given some stocking up ahead of winter heating demand and slightly lowered production from some refinery maintenance as well as production troubles.
Refining margins GO10SGCKMc1 rebounded and climbed to around $15 a barrel, reflecting strength in the paper markets following a knee-jerk reaction to crude price gains.
Cash differentials GO10-SIN-DIF closed the trading session slightly lower at a premium of 31 cents a barrel, with lower-priced sellers still evident in the spot market for end-December cargoes.
Regrade JETREG10SGMc1 held its ground at a premium of around 25 cents a barrel.
SINGAPORE CASH DEALS
– Four gasoil deals, no jet fuel deals
NEWS
– Oil prices climbed on Monday after the fall of Syrian President Bashar al-Assad’s regime introduced greater uncertainty to the Middle East, although the gains were capped by a waning demand outlook for the coming year.
– Saudi Aramco, the world’s biggest crude oil exporter, has cut its January 2025 prices for Asian buyers to the lowest level since early 2021, it said on Sunday, as weak demand from top importer China weighs on the market.
– China will implement more proactive fiscal policy and moderately loose monetary policy next year, and step up “unconventional” counter-cyclical adjustments, state media reported on Monday, citing a Politburo meeting.
– China’s car sales grew 16.6% in November from a year earlier, its fastest pace since January, as government-subsidised auto trade-ins gather steam near the end of the year.
Source: Reuters (Reporting by Trixie Yap)