Asia’s middle distillates markets recorded more term negotiations as some buyers sought first-half 2024 arrival cargoes in the region, though the pace of spot market activity was almost similar to the previous session.
Spot activity is likely to gain momentum again in the next few days as some refiners finish their contractual negotiations for next year, two trade sources said.
A large part of the market remained cautious about next year’s demand-supply fundamentals, given rising supply availability expectations.
Refining margins for 10ppm sulphur gasoil closed the trading session at slightly above $22.50, largely unchanged from the previous session.
Spot market differentials traded at a smaller discount as the swaps market was in a deeper backwardation. However, limited buyers in the spot market capped overall market firmness.
Jet fuel refining margins continued rising for the fourth straight session, reflecting strong expectations for heating oil demand in northeast Asia, despite jet fuel weakness in northwest Europe and a closed arbitrage to the U.S. West Coast.
Regrade differentials gained as well, almost in tandem to a premium of nearly 80 cents a barrel.
Sellers for physical December and January parcels emerged, capping overall market gains.
SINGAPORE CASH DEALS
– One jet fuel deal, no gasoil deals.
INVENTORIES
– Singapore’s middle distillate stockpiles slipped below 9 million barrels for the first time in six weeks as a surge in net gasoil exports offset a decline in net jet fuel/kersosene exports, official data showed on Thursday.
– Distillate stockpiles in the U.S., which include diesel and heating oil, increased by 1.3 million barrels to 112 million barrels, according to the data, versus forecasts of a 1.5 million-barrel rise.
Source: Hellenic Shipping New
