Asia’s middle distillates markets were weighed on by weaker market performance in the West overnight, strong selling interest in the spot paper markets for April amid mixed expectations for April supplies.
Several sellers were aggressively selling April against a backdrop of much softer April ICE gasoil values according to one trade source.
However, the pace of spot trades on the tenders front eased slightly as some refiners cleared a portion of their April sales for now and were waiting by the sidelines for a clearer market direction.
A portion of the market was uncertain aboutthe availability of India-origin barrels for April loading as a handful of refiners have yet to kick-start their offers.
Spot market discounts GO10-SIN-DIF closed the trading session nearing a four-month low, reflecting a much narrower backwardation from the earlier session due to strong April selling in the paper market. Declines were slowed by several spot buying interest from some key oil majors.
Refining margins GO10SGCKMc1 slipped back below $20 a barrel as a reflection of the overall market weakness.
Jet fuel refining margins JETSGCKMc1 trended in a similar direction, but the market was cautious on forward supply fundamentals – given the uncertainty if China-origin export barrels can average above 2 million metric tons for March and April, respectively.
Regrade JETREG10SGMc1 narrowed slightly to a discount of $1.95 a barrel from the previous trading session as a reflection of the weakness in gasoil.
SINGAPORE CASH DEALS O/AS
– One 10ppm gasoil deal, no jet fuel deal
INVENTORIES
– U.S. crude oil inventories and gasoline inventories fell last week, while distillate inventories rose, according to market sources citing American Petroleum Institute figures on Tuesday.
– Middle distillate inventories at Fujairah Oil Industry Zone hit a one-month high of 1.877 million barrels in the week of March 18, according to industry information service S&P Global Commodity Insights.
NEWS
– Kuwait Petroleum Corp (KPC) has issued a semi-term tender offering more high-sulphur fuel oil (HSFO) for loading between April and June, trade sources said on Wednesday.
– China’s fuel oil imports for the January and February period rose by a fifth from a year ago, data from the General Administration of Customs showed on Wednesday.
– Indian state-run oil refiner Bharat Petroleum Corp BPCL.NS has signed a deal with BP BP.L to buy 1 million barrels per month of U.S. West Texas Intermediate (WTI) crude for four months, trade sources said.
– Oil prices edged lower on Wednesday, as a stronger dollar curbed investor appetite while traders took some money off the table after benchmarks rallied to multi-month highs in the previous session.
Source: Reuters (Reporting by Trixie Yap; Editing by Tasim Zahid)
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