June 23, 2020 / 10:47 AM / 2 months ago

Asia Distillates-Gasoil refining margins drop amid demand concerns

    SINGAPORE, June 23 (Reuters) - Asian refining profit margins for 10 ppm gasoil slipped on
Tuesday as traders feared a widespread resurgence of the COVID-19 outbreak in the region would
likely dampen demand recovery.
    Refining margins or cracks for gasoil with 10-ppm sulphur content dropped 41
cents to $$6.31 a barrel over Dubai crude during Asian trading hours, the lowest in more than a
week.
    Seasonal turnarounds and rate cuts at refineries had helped rein in a supply overhang in the
region, but the gasoil market would come under pressure again as refineries ramp up production,
trade sources said.
    Refinitiv oil research assessments showed that this month is expected to see top refining
countries in Asia raising run rates.
    Cash premiums for 10-ppm gasoil GO10-SIN-DIF slipped to 67 cents a barrel to Singapore
quotes on Tuesday, down from 75 cents per barrel a day earlier.
    Meanwhile, cash discounts for jet fuel JET-SIN-DIF were at 81 cents a barrel to Singapore
quotes on Tuesday, compared with a discount of 64 cents on Monday.
    
    CHINA HITS BRAKES ON CRUDE IMPORTS
    - China will press the brakes on crude imports in the third quarter, after record purchases
in recent months, as higher oil prices hurt demand and refiners worry about a second virus
outbreak, analysts and trade sources said.
    - China imported a record 11.3 million barrels per day (bpd) of crude in May. But the
world's top crude importer is expected to receive around 0.8-1.3 million bpd less crude from
abroad in August and September than it did in May, analysts forecast.
    
    SINGAPORE CASH DEALS
    - No jet fuel trades, no gasoil deals
    
    OTHER NEWS
    - Oil prices steadied on Tuesday after a volatile session sparked by confusion over the
status of the U.S.-China trade deal.
    - China aims to produce 1% more crude oil this year than in 2019 and to boost natural gas
output by 4.3%, official targets showed on Monday, as the country seeks to safeguard energy
security even after a coronavirus-driven collapse in oil prices.
    
    ASSESSMENTS    
 MID-DISTILLATES                                                                        
 CASH ($/T)             ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%                47.98     0.88       1.87       47.10  GO-SIN
 GO 0.5 Diff                      -1.10     0.01      -0.90       -1.11  GO-SIN-DIF
 Spot Gas Oil 0.25%               48.62     0.88       1.84       47.74  GO25-SIN
 GO 0.25 Diff                     -0.46     0.01      -2.13       -0.47  GO25-SIN-DIF
 Spot Gas Oil 0.05%               49.51     0.86       1.77       48.65  GO005-SIN
 GO 0.05 Diff                      0.43    -0.01      -2.27        0.44  GO005-SIN-DIF
 Spot Gas Oil 0.001%              49.75     0.79       1.61       48.96  GO10-SIN
 GO 0.001 Diff                     0.67    -0.08     -10.67        0.75  GO10-SIN-DIF
 Spot Jet/Kero                    44.49     0.25       0.57       44.24  JET-SIN
 Jet/Kero Diff                    -0.81    -0.17      26.56       -0.64  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 Sherry Jacob-Phillips)
  
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