June 5, 2012 / 1:11 PM / 5 years ago

Asia Distillates-Gasoil cash premiums at 3-mth high

 SINGAPORE, June 5 (Reuters) - Asian high sulphur gasoil premiums climbed for
a third straight session to reach a three-month high on Tuesday, supported by
regional demand from within Asia, industry sources said.	
 The cash premium for the benchmark 0.5 percent sulphur gasoil increased by 7
cents to 25 cents a barrel, highest since Feb. 21 when it was at 26 cents,
Reuters data showed.	
 The price difference between June and July also strengthened into a wider
backwardated market, gaining 14 cents to 25 cents a barrel. A backwardated
market is when prompt gasoil prices are stronger than those for forward months. 	
 "Gasoil margins are improving but I think it's more because of the fall in
underlying crude oil prices, but I think they're too rich given that most
refineries are completing maintenance," a Singapore-based middle distillates
trader said. 	
 Refinery maintenance, both current and upcoming, have caused a spike in
diesel demand from countries like Vietnam, Philippines and Sri Lanka in June. 	
 The Philippines' biggest oil refiner Petron has issued its second gasoil
tender in two weeks, with its latest tender seeking 250,000 barrels of 500 ppm
sulphur diesel for delivery in late June. 	
 Petron has been conducting repair works at its 180,000 barrels-per-day
refinery since mid-May, which is likely to be extended, traders said. Though,
this could not be confirmed.	
 For jet fuel, Formosa's sell tender for a cargo to be loaded in mid-July
fetched a premium of 6 cents a barrel to Singapore quotes, its highest since a
cargo sold for mid-May loading. 	
 The buyer could not be confirmed, but is likely to be either PetroChina or
Gracewood, a trader said.	
 Arbitrage economics to send the product from east to west could have shored
up the premiums, but this could fall if more output is seen from North Asian
refineries in July. 	
 Formosa has shut one of three crude distillation units in mid-May for about
45-50 days for a planned maintenance which is expected to curb its exports of
oil products.	
 In the Middle East, Iraq's State Oil Marketing Organisation (SOMO) has
renewed its term deal to buy nearly 500,000 tonnes of gasoil for delivery over
the second half of the year at a similar premium to its previous term, industry
sources said. 	
The company has renewed its July-December term contract with Swiss-based
trader Vitol for five 16,000-tonne cargoes of 0.1 percent sulphur gasoil every
month.  	
It will pay a premium of $9.67 a barrel above Middle East quotes on a
delivered basis, similar to its January-June contract, the sources said.  	
 	
 	
 * TENDERS: Petron is seeking 250,000 barrels of 500 ppm sulphur diesel for
delivery into Limay, Bataan over June 28-July 2. The tender closes on June 6,
with same-day validity.	
 	
 * CASH DEALS: No jet deals, two gasoil trades.	
 - Shell sold 160,000 barrels of 0.5 percent sulphur gasoil for loading over
June 20-24 at a premium of 20 cents a barrel to the average of June 20-26
Singapore quotes.	
 - Shell bought 150,000 barrels of 10 ppm sulphur diesel from Total for
loading over June 20-24 at a premium of $3.30 a barrel to Singapore quotes.	
     	
 MID-DISTILLATES                                                             
 CASH ($/T)          ASIA CLOSE  Change   % Change   Prev     RIC
                                                  Close    
 Spot Gas Oil 0.5%       111.19     1.22       1.11   109.97  GO-SIN
 GO 0.5 Diff               0.25     0.07      38.89     0.18  GO-SIN-DIF
 Spot Gas Oil 0.25%      112.34     1.21       1.09   111.13  GO25-SIN
 GO 0.25 Diff              1.40     0.05       3.70     1.35  GO25-SIN-DIF
 Spot Gas Oil 0.05%      113.19     1.16       1.04   112.03  GO005-SIN
 GO 0.05 Diff              2.25     0.00       0.00     2.25  GO005-SIN-DIF
 Spot Gas Oil            114.14     1.16       1.03   112.98  GO10-SIN
 0.001%                                                       
 GO 0.001 Diff             3.20     0.00       0.00     3.20  GO10-SIN-DIF
 Spot Jet/Kero           111.17     1.06       0.96   110.11  JET-SIN
 Jet/Kero Diff            -0.18     0.07     -28.00    -0.25  JET-SIN-DIF
                                                                          
 SWAPS  ($/T)        ASIA CLOSE  Change   % Change   Prev     PM (1130 GMT)
                  (0830 GMT)                      Close    
 Brent M1                 98.06     1.29       1.33    96.77              
 Gasoil M1               111.03     1.21       1.10   109.82             
 Gasoil M1/M2              0.25     0.14     127.27     0.11              
 Gasoil M2               110.78     1.07       0.98   109.71             
 Regrade M1                0.26    -0.22     -45.83     0.48               
 Regrade M2                0.68    -0.09     -11.69     0.77               
 Jet M1                  111.29     0.99       0.90   110.30              
 Jet M1/M2                -0.17     0.01      -5.56    -0.18               
 Jet M2                  111.46     0.98       0.89   110.48              
 Gasoil 0.5%-Dubai        15.82     0.00       0.00    15.82             
 Cracks M1                                                    
 Gasoil 0.5%-Dubai        16.25    -0.02      -0.12    16.27             
 Cracks M2                                                    
 Jet Cracks M1            16.50    -0.09      -0.54    16.59              
 Jet Cracks M2            17.11    -0.09      -0.52    17.20              
 East-West M1            -16.83    -0.74       4.60   -16.09              
 East-West M2            -14.31    -1.77      14.11   -12.54              
 LGO M1                  844.00     9.75       1.17   834.25           
 LGO M1/M2                 4.38     0.00       0.00     4.38              
 LGO M2                  839.63     9.75       1.17   829.88           
 Crack LGO-Brent M1       14.64     0.02       0.14    14.62             
 Crack LGO-Brent M2       14.90     0.03       0.20    14.87             
 	
 (Reporting by Jessica Jaganathan; Editing by Alison Birrane)	
 

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