Asia Distillates-Jet regrade slips from near 1-1/2 year high

Asia Distillates-Jet regrade slips from near 1-1/2 year high
SINGAPORE, Nov 10 (Reuters) - Asia's November jet regrade, the relative strength of jet fuel
prices versus gasoil, slipped on Friday but remained near multi-month highs seen in the previous
The November jet regrade slipped to $1.51 a barrel on Friday, down from $1.58 a barrel on
Thursday, its highest since May 2016, Reuters data showed.
Recent weakness in an gasoil market, coupled with relatively stronger jet fuel prices, have
helped boost the front-month regrade value, sources said.

- "Singapore jet regrades surged over the past days, breaking above the five-year average for
the first time since June to also stand at a (year-to-date) high," said JBC Energy in a research
note on Friday.
- This comes amid a cold snap in Japan, together with weather forecasts for below-average
temperatures, which are likely boosting kerosene demand in the country at a time when the forward
demand cover is roughly 20 days lower than the seasonal average, said JBC, citing the Petroleum
Association of Japan.
- "This is likely to support jet/kero cracks strength in Asia over the coming weeks and make the
arb to Europe more difficult to work," said JBC.

- Gasoil and jet fuel stocks in the Amsterdam-Rotterdam-Antwerp (ARA) oil hub were slightly
lower in the week to Nov. 9, PJK data showed.
- ARA gasoil stocks slipped to 2.056 million tonnes, down 5 percent from the previous week and
30 percent lower from last year, the data showed.
- Gasoil stocks slipped as demand for heating oil in Germany picked up, PJK's Patrick Kulsen
- Jet fuel stocks were 4 percent lower from the previous week to 687,000 tonnes in the week to
Nov. 9. Compared to last year, ARA jet fuel stocks are up 6 percent, the data showed.
- Compared to last year, ARA fuel oil inventories are up 122 percent and are well above the
five-year average of 895,000 tonnes for this time of year.

- South Korean refiners are planning to spend over $5 billion on plant upgrades in response to
tighter rules on shipping fuel, boosting production of low-sulphur fuel oil as well as other
high-end products.
- The refiners hope the investment, which comes ahead of the 2020 introduction of the new rules,
will make them one of the biggest beneficiaries of the new regulations, with many competitors still
waiting to commit to new spending.
- Wood Mackenzie analyst Suresh Sivanandam said the changed regulations would lead to a rise in
demand for gasoil from the bunker sector and would push other refiners to look at investments or
blending to meet demand.

- SINGAPORE CASH DEALS: One gasoil deal, no jet fuel trades.
CASH ($/T) ASIA CLOSE Change % Change Prev Close RIC
Spot Gas Oil 0.5% 72.10 0.72 1.01 71.38 <GO-SIN>
GO 0.5 Diff -1.51 0.02 -1.31 -1.53 <GO-SIN-DIF>
Spot Gas Oil 0.25% 72.39 0.72 1.00 71.67 <GO25-SIN>
GO 0.25 Diff -1.22 0.02 -1.61 -1.24 <GO25-SIN-DIF>
Spot Gas Oil 0.05% 73.34 0.71 0.98 72.63 <GO005-SIN>
GO 0.05 Diff -0.27 0.01 -3.57 -0.28 <GO005-SIN-DIF>
Spot Gas Oil 0.001% 74.59 0.72 0.97 73.87 <GO10-SIN>
GO 0.001 Diff 0.98 0.02 2.08 0.96 <GO10-SIN-DIF>
Spot Jet/Kero 75.08 0.62 0.83 74.46 <JET-SIN>
Jet/Kero Diff -0.05 -0.02 66.67 -0.03 <JET-SIN-DIF>

For a list of derivatives prices, including margins, please double click the RICs
Brent M1
Gasoil M1
Gasoil M1/M2
Gasoil M2
Regrade M1
Regrade M2
Jet M1
Jet M1/M2
Jet M2
Gasoil 500ppm-Dubai
Cracks M1
Gasoil 500ppm-Dubai
Cracks M2
Jet Cracks M1
Jet Cracks M2
East-West M1
East-West M2
Crack LGO-Brent M1
Crack LGO-Brent M2

(Reporting by Roslan Khasawneh; Editing by Mark Potter)

2017-11-10 13:11:57

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