November 11, 2019 / 10:34 AM / a month ago

Asia Distillates-Gasoil cracks hit over 4-month low

    SINGAPORE, Nov 11 (Reuters) - Asian refining margins for 10 ppm gasoil dropped to their
weakest in over four months on Monday, amid expectations for additional supplies in a market
already grappling with ample stocks, while cash premiums for the industrial fuel slipped to
their lowest in more than five weeks.
    Refining margins, also known as cracks, for 10ppm gasoil plunged to $15.23 per
barrel over Dubai crude during Asian trading hours, their lowest since July 9. They were at
$15.34 per barrel on Friday. 
    The cracks for the benchmark gasoil grade in Singapore have shed about 22% since hitting a
4-1/2-year high of $19.14 a barrel in September.
    Cash premiums for gasoil with 10ppm sulphur content GO10-SIN-DIF dropped to 50 cents per
barrel to Singapore quotes on Monday, compared with 53 cents per barrel on Friday.
    Meanwhile, cash differentials for jet fuel JET-SIN-DIF were at a discount of 52 cents per
barrel to Singapore quotes on Monday, compared with a 40-cent discount on Friday.
    Refining profit margins for jet fuel fell to $15.62 a barrel over Dubai crude
on Monday, posting a fresh low since Aug. 23. The cracks were at $15.77 per barrel on Friday.
    
    INDIA'S DIESEL EXPORTS TO WEIGH ON ASIAN REFINING MARGINS
    - Higher diesel exports from India would likely weigh on refining profit margins in Asia, as
fuel demand growth in the country is set to fall to its lowest in at least six years.

    - Increasing diesel exports from India would hurt Asian gasoil cracks, analysts and traders
said. Gasoil cracks, which strengthened in anticipation of new marine fuel norms from January
2020, have already dropped 12% in the last couple of weeks.
    - Growth in demand for fuel in India is on course to fall as the economy slows and after
heavy rains impacted gasoil consumption, which accounts for about two-fifth of the nation's
overall fuel use.
    - India's state-owned refiners used to buy in supplies from private companies to meet demand
at the pump. But with declining domestic consumption, Bharat Petroleum Corp Ltd (BPCL) plans to
export about 200,000 tonnes of diesel every month between November to March, its head of finance
N. Vijayagopal said on Friday.
    - State-run Indian Oil Corp and Mangalore Refinery and Petrochemicals
have also increased diesel exports.
    
    TENDERS
    - India's BPCL was offering 35,000 tonnes of 50ppm sulphur gasoil loading from Mumbai over
Nov. 20-22, trade sources said.
    - BPCL was looking to sell another 35,000 tonnes of 50ppm gasoil for Nov. 26-28 loading from
Mumbai.
    - The tender closes on Nov. 12 and has a same-day validity.
    - For more such information, please click
        
    SINGAPORE CASH DEALS
    - No gasoil trades, no jet fuel deals.
    - For more information, please click
    
    OTHER NEWS
    - Oil prices fell more than 1% on Monday amid concerns over the prospects of a trade deal
between the United States and China, while worries about oversupply also weighed on the market.

    - Iran has discovered a new oilfield in the southwest of the country that has the potential
to boost its reserves by about a third, President Hassan Rouhani said on Sunday.
    - U.S. energy firms last week reduced the number of oil rigs operating for a third week in a
row as producers cut spending on new drilling, even though most are still increasing output as
they benefit from efficiency gains.
    - As the thirst for electricity to power drilling rigs in West Texas drives the state's
energy needs to new highs, oil and gas companies are increasingly relying on wind and solar
power to ensure that the shale boom continues.
    
    ASSESSMENTS
 MID-DISTILLATES                                                                           
 CASH ($/T)             ASIA CLOSE         Change   % Change    Prev Close  RIC
 Spot Gas Oil 0.5%                  71.37    -0.03       -0.04       71.40  GO-SIN
 GO 0.5 Diff                        -3.51    -0.09        2.63       -3.42  GO-SIN-DIF
 Spot Gas Oil 0.25%                 71.51    -0.06       -0.08       71.57  GO25-SIN
 GO 0.25 Diff                       -3.37    -0.12        3.69       -3.25  GO25-SIN-DIF
 Spot Gas Oil 0.05%                 74.44     0.04        0.05       74.40  GO005-SIN
 GO 0.05 Diff                       -0.44    -0.02        4.76       -0.42  GO005-SIN-DIF
 Spot Gas Oil 0.001%                75.38     0.03        0.04       75.35  GO10-SIN
 GO 0.001 Diff                       0.50    -0.03       -5.66        0.53  GO10-SIN-DIF
 Spot Jet/Kero                      74.36    -0.14       -0.19       74.50  JET-SIN
 Jet/Kero Diff                      -0.52    -0.12       30.00       -0.40  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 Rashmi Aich)
  
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