January 30, 2020 / 12:11 PM / 18 days ago

Asia Distillates-Gasoil cash premiums drop to lowest in over 2 months

    SINGAPORE, Jan 30 (Reuters) - Asia's cash premiums for 10 ppm gasoil dipped on Thursday to
their lowest in over two months, weighed down by weaker deals in the physical market, while
middle Singapore distillate inventories rose to their highest in 2-1/2 months.
    Cash premiums for 10 ppm gasoil in Singapore GO10-SIN-DIF dropped a cent to 12 cents per
barrel to Singapore quotes on Thursday, the lowest since Nov. 29.
    Refining margins, also known as cracks, for gasoil with 10 ppm sulphur content
fell to $11.43 per barrel over Dubai crude during Asian trading hours on Thursday, down from
$11.92 per barrel a day earlier.
    Cracks for the benchmark gasoil grade in Singapore have plunged 28.5% this year and are
currently at their lowest seasonal level in the last four years.
    The gasoil cracks would likely come under further pressure, industry analysts and trade
sources said, as transportation demand in China takes a hit due to travel restrictions imposed
to prevent the spread of a flu-like virus.
    The respiratory coronavirus, which originated from the central Chinese city of Wuhan, has
killed 170 and has already spread to at least 15 other countries. In many Chinese cities,
streets are largely deserted and tourist attractions are closed.
    "Demand (for diesel), particularly in relation to coronavirus, is likely to remain a key
uncertainty for the market for the coming months," Vienna-based consultancy JBC Energy said in a
note on Wednesday.
    Meanwhile, cash premiums for jet fuel JET-SIN-DIF were at 29 cents per barrel over
Singapore quotes on Thursday, compared with a premium of 30 cents per barrel in the previous
session.
    Asian jet fuel demand has slumped as global airlines have suspended or scaled back more
direct flights to China's major cities amid an increase in travel warnings and decline in demand
from passengers due to the growing outbreak of the coronavirus.
    Refining profits for jet fuel fell to $9.73 per barrel over Dubai crude on
Thursday, lingering close to their lowest level in 2-1/2 years. They were at $11.04 per barrel
on Wednesday.
    
    SINGAPORE INVENTORIES
    - Singapore onshore middle distillate stocks rose 3.6% to a ten-week high of 11.2 million
barrels in the week to Jan. 29, Enterprise Singapore data showed.
    - Weekly middle distillate inventories have averaged 10.5 million barrels so far in 2020,
having averaged 11.1 million barrels a week in 2019, Reuters calculations showed.
    - Overall, onshore middle distillate inventories were 5.1% lower year on year.
    - Light distillate stocks climbed 84,000 barrels to a two-week high of 13.06 million barrels
in the week to Wednesday, while fuel oil stocks rose 737,000 barrels to a more than seven-month
high of 23.6 million barrels, Enterprise Singapore data showed.
    
    EIA INVENTORIES
    - U.S. crude oil stockpiles rose far more than anticipated last week as refiners cut runs on
the back of weakened demand for fuel, with gasoline inventories building to a record high, the
Energy Information Administration said on Wednesday. 
    - Crude inventories rose 3.5 million barrels in the week to Jan. 24 to 431.7 million
barrels, compared with analysts' expectations in a Reuters poll for a 482,000-barrel rise.

    - Distillate stockpiles, which include diesel and heating oil, fell 1.3 million barrels in
the week to 144.7 million barrels, versus expectations for a 1.1 million-barrel drop, the EIA
data showed.
    
    TENDERS
    - Sri Lanka's Ceylon Petroleum Corp (Ceypetco) is seeking a combined cargo of 130,000
barrels of 500ppm gasoil and 160,000 barrels of jet fuel for delivery to Dolphin Tanker Berth
and SPM Muthurajawela, Colombo, over March 1-2 on a DAP basis.
    - The tender closes on Feb. 5 and will be held valid for three days.
    - Ceypetco is seeking another combined cargo of 130,000 barrels of 500ppm gasoil and 160,000
barrels of jet fuel for delivery over March 11-12 on a DAP basis.
    - The tender closes on Feb. 11 and will be held valid for three days.
    - For more such information, please click
    
    SINGAPORE CASH DEALS
    - No gasoil trades, one jet fuel deal.
    - For more information, click
    
    OTHER NEWS
    - Sinopec Corp's refinery and petrochemical complex in Tianjin will shut down for two months
for a regular overhaul from early May, cutting its crude throughput this year by about 2 million
tonnes, an industry official told Reuters on Thursday.
    - Oil prices fell on Thursday as alarm spread over the economic impact of the Wuhan virus in
China, while a bigger-than-expected increase in U.S. crude stocks added to the negative tone.

    
    ASSESSMENTS
 MID-DISTILLATES                                                                         
 CASH ($/T)             ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%                66.24    -2.08      -3.04       68.32  GO-SIN
 GO 0.5 Diff                      -1.95     0.06      -2.99       -2.01  GO-SIN-DIF
 Spot Gas Oil 0.25%               66.95    -2.08      -3.01       69.03  GO25-SIN
 GO 0.25 Diff                     -1.24     0.06      -4.62       -1.30  GO25-SIN-DIF
 Spot Gas Oil 0.05%               68.09    -2.08      -2.96       70.17  GO005-SIN
 GO 0.05 Diff                     -0.10     0.06     -37.50       -0.16  GO005-SIN-DIF
 Spot Gas Oil 0.001%              68.31    -2.14      -3.04       70.45  GO10-SIN
 GO 0.001 Diff                     0.12    -0.01      -7.69        0.13  GO10-SIN-DIF
 Spot Jet/Kero                    66.83    -2.92      -4.19       69.75  JET-SIN
 Jet/Kero Diff                     0.29    -0.01      -3.33        0.30  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 Anil D'Silva)
  
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