Views Article – Sharenet Wealth

Asia, News

Asia Distillates-Gasoil cracks drop on concerns over demand recovery

SINGAPORE, July 7 (Reuters) – Asian refining margins for 10 ppm gasoil slipped on Tuesday despite weaker raw material crude prices as traders expect refiners to add fresh supplies to the market, while concerns about demand due to a resurgence of coronavirus cases in some countries lingered. Refining margins, also known as cracks, for gasoil with 10-ppm sulphur content fell 30 cents to $6.69 a barrel over Dubai crude during Asian trading hours. A resurgence of daily cases in markets such as China and South Korea is fuelling worries about near-term demand as reimposed lockdowns or containment measures would be detrimental for market recovery, market watchers said. Cash premiums for 10-ppm gasoil <GO10-SIN-DIF> dropped to 59 cents a barrel to Singapore quotes on Tuesday, compared with 62 cents per barrel a day earlier. Meanwhile, cash differentials for jet fuel in Singapore <JET-SIN-DIF> were at a discount of 42 cents a barrel to Singapore quotes on Tuesday, compared with a discount of 44 cents per barrel on Monday. The prompt-month time spread for the aviation fuel in Singapore remained in a contango structure to trade a discount of 70 cents a barrel on Tuesday, Refinitiv Eikon data showed. Jet fuel cracks rose 15 cents to $1.94 a barrel over Dubai crude on Tuesday. SINGAPORE CASH DEALS – Two gasoil deals, no jet fuel trades OTHER NEWS – Malaysia’s flagship budget carrier AirAsia Group Bhd expects its 2020 capacity to be just 45%-60% of last year’s levels due to the coronavirus outbreak and to fill 70-75% of seats this year compared with the usual 85%. – Crude oil prices fell on Tuesday amid concerns that a surge in new coronavirus cases, especially in the United States, will hamper any recovery in fuel demand. ASSESSMENTS MID-DISTILLATES CASH ($/T) ASIA CLOSE Change % Change Prev Close RIC Spot Gas Oil 0.5% 48.16 -1.05 -2.13 49.21 <GO-SIN> GO 0.5 Diff -0.84 -0.01 1.20 -0.83 <GO-SIN-DIF> Spot Gas Oil 0.25% 48.80 -1.05 -2.11 49.85 <GO25-SIN> GO 0.25 Diff -0.20 -0.01 5.26 -0.19 <GO25-SIN-DIF> Spot Gas Oil 0.05% 49.49 -1.05 -2.08 50.54 <GO005-SIN> GO 0.05 Diff 0.49 -0.01 -2.00 0.50 <GO005-SIN-DIF> Spot Gas Oil 0.001% 49.59 -1.07 -2.11 50.66 <GO10-SIN> GO 0.001 Diff 0.59 -0.03 -4.84 0.62 <GO10-SIN-DIF> Spot Jet/Kero 43.13 -0.54 -1.24 43.67 <JET-SIN> Jet/Kero Diff -0.42 0.02 -4.55 -0.44 <JET-SIN-DIF> For a list of derivatives prices, including margins, please double click the RICs below. 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 LGO M1 LGO M1/M2 LGO M2 Crack LGO-Brent M1 Crack LGO-Brent M2 (Reporting by Koustav Samanta; Editing by Amy Caren Daniel)

© 2019 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.