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Asia Oil Swaps-Fuel oil cracks at 8-week low on poor physical demand
July 16, 2012 / 7:33 AM / 5 years ago

Asia Oil Swaps-Fuel oil cracks at 8-week low on poor physical demand

(For 12-month forward curve, click )
    SINGAPORE, July 16 (Reuters) - Asia's fuel oil front-month
crack stood at an 8-week low on Monday, as weak demand for
marine fuels continued to depress sentiment.
    "Sales at our Singapore port were definitely slower this
month but other ports are still doing well," said a
Singapore-based bunker trader.
    Singapore marine fuel sales fell 8.5 percent in June
month-on-month to a three-month low as vessel arrivals slipped,
according to data from the Maritime and Port Authority of
Singapore. Total volumes for June stood at 3.647 million tonnes
down from an all-time high of almost 4 million tonnes in May.
    Cracks for gasoil and naphtha also eased to a one-and-a-half
week low because of strengthening Brent crude but demand for
physical cargoes continued to be seen firm.
    India's Mangalore Refinery and Petrochemicals Ltd (MRPL)
sold gasoline, gasoil and naphtha at sharply higher premiums,
reflecting strong fundamentals. 
    August fixed-price swaps for all products were firmer as
Brent crude rose 81 cents to $101.45 per barrel by 0430 GMT from
Friday's Asian close. 
    
    FUEL OIL CRACKS AT 8-WEEK LOW
    The August fuel oil crack stood at an 8-week low of a $4.47
per barrel discount to Dubai crude according to Reuters data.
The September contract was at a $4.48 discount per barrel to
Dubai crude.
    Fuel oil inter-month timespreads were largely stable from
the previous session except the September/October intermonth
spread which fell 13 ce n ts to a $2.50 per tonne backwardation.
The August/September inter-month which turns prompt today stood
at a $2.75 per tonne backwardation.
    August and September 180-cst fixed-price swaps were valued
at $613.00 and $610.25 per tonne, respectively, up $4.25 per
tonne or 0.70 percent. 
    
    GASOIL CRACKS EASE TO 1.5-WEEK LOW
    Asia's gasoil cracks eased to a one-and-a-half week low but
demand for physical cargoes continued to be seen firm ahead of
Ramadan. 
    Some traders raised concerns that demand had begun to be
stifled as diesel premiums shot past the three-year high mark on
July 11. 
    Gasoil timespreads were mostly weaker in early trade with
the prompt August/September spread falling 5 cents to a
backwardation of 25 cents. The September/October intermonth
spread also fell 3 cents to a 18 cents backwardation.
    The August crack declined 15 cents to a premium of $16.89 a
barrel to Dubai crude. The September crack dropped 10 cents to a
premium of $17.06 a barrel to Dubai crude.
    August and September fixed-priced contracts were at $115.67
and $115.42 per barrel, respectively, up 77-82 cents or
0.67-0.72 percent.
    The August regrade, the spread between jet fuel and gasoil,
was flat at 88 cents while the September regrade inched down 3
cents to $1.08.
    
    NAPHTHA FUNDAMENTALS SEEN STRONG
    Fundamentals for the Asia naphtha market continued to be
seen as strong even after cracks eased to a one-and-a-half week
low.
    The CFR September naphtha crack was 70 cents lower at a
discount of $9.84 to Brent crude. The CFR October crack fell 63
cents to a discount of $9.56 to Brent crude.
    The front-month Auust/September inter-month spread also
eased 50 cents per tonne to a $3.50 per tonne backwardation.
    The August/September intermonth spread fell 50 cents to a
$3.00 per tonne backwardation.
    The CFR July swap was 50 cents higher at $828.00 per tonne,
while the FOB Singapore July swap was $1.05 stronger at $90.80
per barrel.
    
 PRODUCTS                            Price           Change  Pct
                                                             Change
 AUGUST naphtha                      90.70/90.90     1.05    1.17
 SEPTEMBER naphtha                   90.10/90.30     1.00    1.12
                                                             
 AUGUST naphtha                      827.88/828.13   0.50    0.06
 SEPTEMBER naphtha                   824.25/824.75   1.00    0.12
                                                             
 AUGUST gasoil                       115.57/115.77   0.77    0.67
 SEPTEMBER  gasoil                   115.32/115.52   0.82    0.72
 AUGUST fuel oil                     612.75/613.25   4.25    0.70
 SEPTEMBER  fuel oil                 610.00/610.50   4.25    0.70
 Product                             Price           Change  
 AUGUST regrade                      0.78/0.98       0.00    
 AUGUST gasoil crack                 16.79/16.99     -0.15   
 AUGUST 180/380 cst                  11.50/11.75     0.00    
                                                             
 AUGUST fuel oil crack               -4.57/-4.37     -0.27   
                                                             
 AUGUST jet fuel crack               17.67/17.87     -0.15   
                                                             
 SEPTEMBER naphtha crack             -9.94/-9.74     -0.70   
                                                             
                                                             
 Inter-month spread                  Mean             Prev   Change
 AUGUST/SEPTEMBER naphtha            0.60            0.55    0.05
 AUGUST/SEPTEMBER naphtha (CFR       3.50            4.00    -0.50
 Japan)                                                      
 AUGUST/SEPTEMBER gasoil             0.25            0.30    -0.05
 AUGUST/SEPTEMBER fuel oil           2.75            2.75    0.00
    
    

 (Reporting by Loh Bohan; Editing by Ed Davies)

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