Asia’s middle distillates markets started clawing back some of their losses from the previous session on Tuesday, as more spot sales activity was underway for both September and October cargoes.
Paper swap markets also rebounded, but the September and October price difference was little changed from the previous trading session.
Some support came from the wider east-west arbitrage price spread in the past two trading sessions, with the price difference between Asia and northwest Europe at a one-and-a-half-month high.
Talks of some production run cuts resurfaced given the squeezed refining margins regionally in the past four trading sessions, some sources said. Further details could not be confirmed.
Refining margins for the transport and industrial fuel were at $13.18 a barrel at the market’s close, 20 cents higher than the previous session.
Spot cash discounts fell back to discounts of around 46 cents a barrel, with lower-priced offers still continuing for a second straight session this week.
Buying interest for second-half September cargoes stayed tepid in the open trading window.
For jet fuel, at least two northeast Asian refiners resumed their September sales, contributing to slightly more trading liquidity, likewise gasoil, as sale prices continued to be slightly more lucrative than gasoil.
Regrade narrowed slightly to a discount of 30 cents a barrel.
SINGAPORE CASH DEALS
– No gasoil deal, one jet fuel deal.
REFINERY NEWS
– Gazpromneft Moscow refinery suspended operations at combined refining unit Euro+, which includes crude distillation unit CDU-6, after a fire on Sunday, three sources told Reuters on Monday.
NEWS
– Top oil exporter Saudi Arabia is expected to cut prices for most of the crude grades it sells to Asia in October after Middle East benchmark Dubai slumped last month, industry sources said on Monday.
– Indonesia issued a presidential regulation to set up energy buffer stocks to be used when there was an energy shortage or disruption of energy infrastructure, a document from the president’s office and reviewed by Reuters on Tuesday showed.
Source: Reuters (Reporting by Trixie Yap; Editing by Shreya Biswas)