Asia Distillates-Diesel margins near 1-year high, cash differentials hit 1-month high

Reuters
06-16
Asia Distillates-Diesel margins near 1-year high, cash differentials hit 1-month high

SINGAPORE, June 16 (Reuters) - Asia's middle distillates markets extended gains on the pricing front amid geopolitical conflict in the Middle East, with diesel margins at near 1-year highs and prices up 2-3%, though window trading liquidity started the week thin.

Paper markets continued their incline, reflecting the gains in crude markets due to concern around the conflict's impact on Middle East supplies.

The east-west price spread widened to discounts of more than $30 per metric ton, its widest since the end of February.

More than 2 million metric tons of diesel are typically shipped out of the Strait of Hormuz region per month, while more than 1.3 million tons of jet fuel and kerosene is exported from sellers in that region, Kpler shiptracking data showed.

These exports take up about 10% and 20% of the total volumes globally, the data added.

Clean product tankers, however, are still prowling the Straits of Hormuz for now, shiptracking data from Kpler and LSEG showed, with more than 10 ships in the area carrying middle distillates.

Refining margins GO10SGCKMc1 gained to slightly above $17.9 a barrel, its highest since early July last year.

Meanwhile on the trading window, only bids were present and offers were scant - with jet fuel discussions remaining thin. The 10ppm sulphur gasoil cash differentials GO10-SIN-DIF jumped to 75 cents per barrel, reflecting the steeper paper market backwardation and firmer bids.

Regrade JETREG10SGMc1 widened to more than discounts of $1.40 per barrel.

SINGAPORE CASH DEALS O/AS

- No deals for gasoil and jet fuel

REFINERY NEWS REF/OUT

- A fire on the resid hydrotreater (RHU) was nearly extinguished on Saturday afternoon at Marathon Petroleum Corp's MPC.N 631,000 barrel-per-day (bpd) Galveston Bay Refinery in Texas City, Texas, said people familiar with plant operations.

NEWS

- China's crude oil throughput declined by 1.8% in May from a year earlier to the lowest level since August, official data showed on Monday, as maintenance at both state-owned and independent refineries curbed operations.

- The importance of oil and gas can't be underestimated at times when conflicts occur, something that was currently being seen, the head of Saudi oil giant Aramco 2222.SE told an energy conference on Monday.

- U.S. ultra-low sulfur diesel futures HOc1 hit the highest level since February last Friday, outpacing gains in oil and gasoline as analysts warned that diesel supply is the most exposed to the conflict in the Middle East.

- India is reviewing the global oil supply situation on a daily basis and has enough energy stocks, federal oil minister Hardeep Singh Puri said on Monday.

- The costs of chartering tankers to move oil from the Middle East to Asia have climbed and ship bookings have slowed as the Israel-Iran conflict fuels worries of potential disruptions, industry sources told Reuters on Monday.

- Oil prices were volatile on Monday, after surging 7% on Friday, as renewed strikes by Israel and Iran over the weekend increased concerns that the conflict could widen across the Middle East and significantly disrupt oil exports from the region. O/R

PRICES

MIDDLE DISTILLATES

CASH ($/BBL)

ASIA CLOSE

Change

Prev Close

RIC

Spot Gas Oil 0.5%

84.68

2.24

82.44

GO-SIN

GO 0.5 Diff

-5.23

0.09

-5.32

GO-SIN-DIF

Spot Gas Oil 0.25%

88.61

2.24

86.37

GO25-SIN

GO 0.25 Diff

-1.30

0.09

-1.39

GO25-SIN-DIF

Spot Gas Oil 0.05%

89.94

2.24

87.70

GO005-SIN

GO 0.05 Diff

0.03

0.09

-0.06

GO005-SIN-DIF

Spot Gas Oil 0.001%

90.66

2.28

88.38

GO10-SIN

GO 0.001 Diff

0.75

0.13

0.62

GO10-SIN-DIF

Spot Jet/Kero

88.40

2.31

86.09

JET-SIN

Jet/Kero Diff

0.03

0.08

-0.05

JET-SIN-DIF

For a list of derivatives prices, including margins, please double click the RICs below.

Brent M1

BRENTSGMc1

Gasoil M1

GOSGSWMc1

Gasoil M1/M2

GOSGSPDMc1

Gasoil M2

GOSGSWMc2

Regrade M1

JETREGSGMc1

Regrade M2

JETREGSGMc2

Jet M1

JETSGSWMc1

Jet M1/M2

JETSGSPDMc1

Jet M2

JETSGSWMc2

Gasoil 500ppm-Dubai Cracks M1

GOSGCKMc1

Gasoil 500ppm-Dubai Cracks M2

GOSGCKMc2

Jet Cracks M1

JETSGCKMc1

Jet Cracks M2

JETSGCKMc2

East-West M1

LGOAEFSMc1

East-West M2

LGOAEFSMc2

LGO M1

LGOAMc1

LGO M1/M2

LGOASPDMc1

LGO M2

LGOAMc2

Crack LGO-Brent M1

LGOACKMc1

Crack LGO-Brent M2

LGOACKMc2

(Reporting by Trixie Yap; Editing by Leroy Leo)

((trixie.yap@thomsonreuters.com;))

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