Asia’s middle distillates markets were thinly discussed on the open trading window on Friday, though spot premiums extended gains, while key northeast Asian refiners were gradually selling May spot cargoes and some demand emerged from Vietnam.
May spot activity was a key focus for the week, with at least four refiners outselling their usual availability.
Deals were mainly in the discounted territory, slightly down from a month earlier when a portion of deals was still selling at premiums to FOB Singapore quotes.
Worries about ample supplies continued to weigh, though markets were split on demand outlooks for the remainder of April and May.
Buying interest surfaced from Vietnam’s key importer Petrolimex for end-April and early May spot cargoes, with a spot tender to close on Monday next week.
However, a closed east-west arbitrage limited price movements within the Asian region, though the pace of India and Middle East-origin exports could slow slightly as planned refinery maintenance starts in the two respective regions.
The 10ppm sulphur gasoil refining margins (GO10SGCKMc1) closed the week’s last trading session at around $14 a barrel, gaining almost $1 a barrel from a week earlier.
Cash differentials (GO10-SIN-DIF) gained to a one-month high of around 33 cents a barrel, reflecting a wider April-May backwardation.
Regrade (JETREG10SGMc1) went back to discounts of around $1 a barrel, steadying week on week.
SINGAPORE CASH DEALS
– No deals for both fuels
INVENTORIES
– Oil product stocks independently held in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub fell by more than 3% on the week, data from Dutch consultancy Insights Global showed on Thursday.
REFINERY NEWS
– An oil refinery operated by Russian oil giant Rosneft ROSN in Komsomolsk-on-Amur in the country’s Far East region is producing at full capacity after a fire at the site was extinguished on Thursday, TASS news agency reported.
NEWS
– Saudi Arabia’s crude oil supply to China will surge in May from the prior month as a sharp price cut by the kingdom attracted more demand, sources said on Friday.
– Oil prices rose on Friday after settling more than $2 a barrel lower in the previous session but were set to drop for a second straight week on concerns over a prolonged trade war between the United States and China.
– Beijing on Friday increased its tariffs on U.S. imports to 125%, hitting back against U.S. President Donald Trump’s decision to hike duties on Chinese goods to 145%, raising the stakes in a trade war that threatens to up-end global supply chains.
– The Trump administration imposed sanctions on Iranian oil trading networks on Thursday, including on a China-based crude oil storage terminal linked via a pipeline to an independent refinery, just days before talks between the U.S. and Iran.
– Venezuela’s state oil company PDVSA has canceled several authorizations it had granted U.S.-based producer Chevron CVX.N to load and export Venezuelan crude in April, three sources with knowledge of the decision said on Thursday.
– Freight shipping costs on the Rhine river in Germany surged this week as water levels fell further, compelling vessels to sail less than half full, commodity traders said on Thursday.
Source: Reuters