Asia’s middle distillates markets dipped on Monday reflecting a weak macroeconomic trading environment, against a backdrop of ample August supplies, though some buying interest on the open trading window capped overall softness.
Trafigura bought more cargoes for the second-half August loading on the open trading window, adding on to their purchase of 300,000 barrels from last week.
Some Russian-origin material on vessel Advantage Portofino seemingly arrived in Singapore for discharge these few days, according to LSEG shiptracking data and two trade sources.
One more cargo on board Advantage Life is also bound for Singapore by the end of the month, they added.
Sufficient supplies are still expected in August to early September for now, which is likely to weigh on overall price and margins movement in the near term, one of the sources said.
The prompt month paper markets for August-September and September-October stayed firmly in a contango structure amid these expectations.
Refining margins were at around $17 a barrel at the market’s close.
Spot market discounts GO10-SIN-DIF were slightly buoyed 29 cents a barrel at the end of the trading session, with Trafigura buying more end-August cargoes, continuing their purchases from last week.
On the jet fuel front, markets were waiting for a clearer supply direction as some refiners are likely to start their September sales this week.
Regrade closed the trading session at a discount of 85 cents a barrel.
SINGAPORE CASH DEALS
– One 10ppm gasoil deal, no jet fuel deal.
REFINERY NEWS REF/OUT
– Motiva Enterprises began restarting the gasoline-producing fluidic catalytic cracker (FCC) on Sunday morning at its 626,000-barrel-per-day (bpd) Port Arthur, Texas, refinery, people familiar with plant operations said.
NEWS
– Japan’s gasoline imports are expected to stay elevated through August after rising 20% in June as outages at its refineries are reducing output during peak summer demand season, traders and analysts said.
– Top oil exporter Saudi Arabia raised the price for the flagship Arab light crude it sells to Asia in September for the first time in three months, while cutting prices to the other regions.
– Oil futures extended losses in a volatile session on Monday as fears of a recession in top oil consumer the United States offset supply worries stemming from mounting tensions in the Middle East, the world’s largest oil-producing region.
– Growth in China’s services activity accelerated in July helped by new orders, although momentum in overseas demand eased to its slowest pace in 11 months, a private sector survey showed on Monday.
Source: Reuters (Reporting by Trixie Yap; Editing by Vijay Kishore)