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Energy

Asia Distillates-Jet fuel cracks rise further on seasonal kerosene demand

    SINGAPORE, Nov 11 (Reuters) - Asia's cash discounts for jet fuel widened on Wednesday, hurt
by muted buying interest in the physical market, while refining profit margins for the aviation
fuel firmed for a second consecutive session.
    Cash discounts for jet fuel JET-SIN-DIF were at 24 cents a barrel to Singapore quotes,
compared with a discount of 9 cents per barrel a day earlier.
    Refining margins, also known as cracks, for jet fuel rose to $3.63 per barrel
over Dubai crude during Asian trading hours, a fresh high since March 30. They were at $3.55 per
barrel a day earlier.
    "The onset of winter in North Asia has been providing some support to the kero complex,"
said Sandy Kwa, oil market analyst at energy consultancy FGE.
    "Kerosene demand in Japan is starting to see a seasonal boost, and we believe that some
Japanese refiners are redirecting some gasoil production back into the jet/kero pool."
    The jet fuel cracks, which also determine the profitability of kerosene, have surged 48% in
the last week, Refinitiv Eikon data showed.
    
    INVENTORIES
    - Middle-distillate inventories in the Fujairah Oil Industry Zone slipped 1.7% to 5.4
million barrels in the week ended Nov. 9, data via S&P Global Platts showed.
    - The weekly stocks in Fujairah have averaged about 4 million barrels so far in 2020,
compared with the weekly average of 2.4 million barrels in 2019, Reuters calculations showed.
    - U.S. distillate stockpiles fell by 5.6 million barrels in the week to Nov. 6, compared
with expectations for a draw of 1.9 million barrels, data from industry group the American
Petroleum Institute (API) showed on Tuesday. 
    
    SINGAPORE CASH DEALS
    - No jet fuel trade, no gasoil deals
    
    OTHER NEWS
    - Oil prices climbed on Wednesday as hopes of an effective COVID-19 vaccine continued to
bolster sentiment, while an industry report showed U.S. crude inventories fell more than
expected.
    - Japanese oil refiner Idemitsu Kosan expects higher gasoline and diesel exports in
the October-March half of its financial year as its run rates are likely to recover to 85%-89%
from 70% in the first half, an executive said on Tuesday.
    
    ASSESSMENTS
 MID-DISTILLATES                                                                         
 CASH ($/T)             ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%                48.23     2.38       5.19       45.85  GO-SIN
 GO 0.5 Diff                      -1.12     0.09      -7.44       -1.21  GO-SIN-DIF
 Spot Gas Oil 0.25%               48.61     2.38       5.15       46.23  GO25-SIN
 GO 0.25 Diff                     -0.74     0.09     -10.84       -0.83  GO25-SIN-DIF
 Spot Gas Oil 0.05%               48.86     2.44       5.26       46.42  GO005-SIN
 GO 0.05 Diff                     -0.49     0.15     -23.44       -0.64  GO005-SIN-DIF
 Spot Gas Oil 0.001%              49.19     2.54       5.44       46.65  GO10-SIN
 GO 0.001 Diff                    -0.16     0.25     -60.98       -0.41  GO10-SIN-DIF
 Spot Jet/Kero                    47.38     1.74       3.81       45.64  JET-SIN
 Jet/Kero Diff                    -0.24    -0.15     166.67       -0.09  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 Devika Syamnath)
  
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