Asia’s middle distillates markets recorded weaker spot price movements this week, as talks of ample prompt supplies came into focus despite slightly wider east-west price spreads, with trading window deals flipping into discount.
A handful of February cargoes from two key China oil majors emerged after the Lunar New Year holidays, further weighing on spot markets.
Meanwhile, some refiners also kickstarted March spot sales – though deal prices were in a wide range as traders’ expectations were slightly mixed.
Taiwan’s CPC sold March 10ppm sulphur gasoil at discounts of 20-30 cents per barrel, while Formosa Petchem sold March jet fuel at premiums of 60-70 cents per barrel.
More selling interest will likely emerge a week later, in line with earlier expectations, but traders were still seeking for demand clues to find a near-term respite.
Jet fuel/kerosene markets were slightly more supported in comparison given the last surge in winter heating demand from northeast Asia, one trader said.
Japan’s imports of jet fuel/kerosene were robust in both December and January, shiptracking data from LSEG and Kpler showed.
Refining margins (GO10SGCKMc1) recovered by around $2 a barrel from last week, despite overall weaker Asian supply-demand fundamentals.
Bids for 10ppm sulphur gasoil once again were scant, with plentiful of lower-priced offers readily available.
Cash differentials (GO10-SIN-DIF) crashed from a week earlier, falling by 65 cents per barrel, with the market closing at 4 cents a barrel on Friday.
Window deals for prompt February cargoes turned into discounts.
Regrade (JETREG10SGMc1) widened slightly to discounts of around 70 cents per barrel week-on-week.
SINGAPORE CASH DEALS
– One gasoil deal, no jet fuel deal.
INVENTORIES
– Gasoil stocks independently held in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub rose by over 6% on the week to their highest in nearly four years, data from Dutch consultancy Insights Global showed.
NEWS
– Oil and gas traders are likely to seek waivers from Beijing over tariffs that the Chinese government plans to impose on U.S. crude and liquefied natural gas (LNG) imports from February 10, trade sources said on Thursday.
– Oil executives called on Thursday for a return to navigation through the Red Sea en route to the Suez Canal following a halt in attacks by Iran-backed Houthi rebels, but said firms were cautiously monitoring shipping conditions and competitors.
– Oil prices rose marginally in Asian trade on Friday but were on track for a third straight week of decline, hurt by U.S. President Donald Trump’s renewed trade war on China and threats of tariff hikes on other countries.
– India’s fuel demand in January rose 3.2% compared with the same month in 2024, government data showed on Friday.
Source: Reuters