SINGAPORE/JAKARTA (Reuters) - Two of six tankers used to store gasoline in Asia have arrived in Indonesia, with shipments into Asia’s largest petrol importer expected to rise this month versus May as Pertamina replenishes stocks, according to industry sources and Refinitiv shipping data.
Indonesia’s fuel demand slumped in the second quarter and inventories rose after the government imposed measures to curb the coronavirus, prompting companies to store gasoline onboard ships off Singapore and Malaysia.
The tankers - Aframax-sized Sloane Square, chartered by Equinor and carrying Norwegian gasoline - and Panamax-sized SCF Prudencia chartered by Pertamina, arrived at Indonesia’s Merak and Tuban ports, respectively, in the past week.
The ships can carry more than 120,000 tonnes (1 million barrels) of gasoline when fully loaded.
The shipments were planned “to maintain our stockpile levels”, Pertamina’s spokeswoman said, although Indonesia’s May petrol demand as of Wednesday, was still 27% below February’s level. Fuel stocks fell in May as its Balikpapan refinery was shut for maintenance.
Equinor has declined to comment.
Indonesia’s June imports are estimated at about 7 million barrels, said a trading source who tracks its purchases closely.
This is up from May which was estimated at between 5 million and 6 million barrels, half of monthly average in 2019 and down from February’s imports of 8 million barrels, according to Refinitiv Oil Research.
A third ship, the Panamax-sized Nordvenus, chartered by Pertamina in April to store gasoline, discharged its cargo in Singapore in May, Refinitiv data showed.
“As countries emerge from lockdowns and economic activities resume, we expect a gradual recovery in oil product demand over 2H. Among the key fuels, the demand recovery for gasoline should come fastest,” said Sri Paravaikkarasu, director for Asia oil at consulting firm FGE.
Asia’s gasoline refining margin has returned to a slight premium of 37 cents to Brent crude on June 3 for the first time in two weeks.
“Gasoline margins have been volatile despite demand recovery as it takes time for the excess cargoes to be absorbed,” said KY Lin, spokesman of Formosa Petrochemical Corp which operates a 540,000 barrels per day (bpd) refinery in Mailiao, Taiwan.
“But demand for naphtha, as a whole, would help to lift the entire light distillates fundamental.”
Reporting by Seng Li Peng in Singapore and Wilda Asmarini in Jakarta; Editing by Florence Tan and Jason Neely