November 12, 2019 / 10:43 AM / a month ago

Asia Distillates-Gasoil cracks weaken further, slip to 5-mth low

    SINGAPORE, Nov 12 (Reuters) - Asian refining profit margins for 10 ppm gasoil weakened
further on Tuesday, slipping to their lowest level in five months, weighed down by abundant
supplies and weaker demand in the physical market.
    Refining margins or cracks for 10 ppm gasoil fell to $14.71 per barrel
over Dubai crude during Asian trade, hitting their lowest levels since June 11. They were
at $15.23 per barrel a day earlier.
    The gasoil cracks in Asia have come under pressure as some regional refineries,
undergoing planned maintenance, are returning to production, while India is exporting more
on the back of weaker demand in its domestic market.
    "There is a lot of marine gasoil (MGO) ex-Indian refineries in the market now ... In
the short term, I think they will continue to export more gasoil as the domestic market
cannot absorb the volumes," a Singapore-based middle distillate trader said.
    "There's too much of Indian gasoil looking for homes at the moment ... The Indian
barrels would further worsen the existing supply overhang in the overall Asian gasoil
market," she added.
    Indian state-run refiners including Indian Oil Corp, Mangalore Refinery and
Petrochemicals and Bharat Petroleum Corp Ltd have all ramped up their
gasoil exports in recent weeks. 
    Cash premiums for gasoil with 10 ppm sulphur content GO10-SIN-DIF fell for a sixth
straight session on Tuesday to a six-week low of 39 cents per barrel to Singapore quotes,
compared with a 50 cent premium on Monday. 
    Meanwhile, cash differentials for jet fuel JET-SIN-DIF widened their discounts to 56
cents per barrel to Singapore quotes on Tuesday, compared with a discount of 52 cents per
barrel on Monday.
    Refining profit margins for jet fuel dropped to $15.05 per barrel over
Dubai crude on Tuesday, their lowest in over four months. The cracks were at $15.62 per
barrel on Monday.
    - Belgian tanker operator Euronav signed a service agreement on Tuesday
making Malaysia's Linggi Port its supply base, providing low-sulphur marine fuels and other
services for ships plying East-of-Suez routes, the port operator said.
    - The agreement also marks a milestone for Malaysia's ambitions to develop its maritime
and bunkering industries, the statement said, in an effort to rival the world's largest hub
in neighbouring Singapore.
    - "This (deal) is in line with our vision to fully utilise our advantages to develop
our bunkering industry," said Malaysian Transport Minister Anthony Loke Siew Fook at the
    - Malaysia's deal with Euronav might mark the beginning of a new trend if the right
infrastructure and policies were introduced, several trade sources said.
    - India's Mangalore Refinery and Petrochemicals Ltd (MRPL) has offered 65,000 tonnes of
high speed diesel (HSD) - gasoil with 10 ppm sulphur content - for Dec. 1-3 loading from
the port of New Mangalore.
    - The tender closes on Nov. 15 and has a same-day validity.
    - MRPL was also looking to sell 40,000 tonnes of jet fuel for Dec. 7-9 loading, in a
tender closing on Nov. 14. The tender has a same-day validity.
    - For more such information, please click
    - One gasoil trade, no jet fuel deals.
    - Unipec sold 158,000 barrels of 10ppm gasoil to Winson Oil for Nov. 27-Dec. 1 loading
at a premium of 40 cents a barrel to Singapore quotes.
    - For more information, please click
    - OPEC and allied oil producers will probably extend a deal to limit crude supply but
are unlikely to deepen their cuts, Oman's energy minister said on Monday, as the United
Arab Emirates said it was not worried about long-term growth in oil demand.
    - Saudi Arabia raised its oil output in October to 10.3 million barrels per day but
kept its supply to the oil markets below its OPEC output target, a Saudi industry source
familiar with the kingdom's oil operations told Reuters.
    - Oil prices rose on Tuesday, reversing early losses on hopes that U.S. President
Donald Trump may signal progress on trade talks with China in a speech later in the day.

    - A new oilfield discovered in southwestern Iran is the second largest found in the
country, Iran's oil minister, Bijan Zanganeh, said on Monday, according to SHANA, the
ministry's news site.
 CASH ($/T)             ASIA CLOSE         Change   % Change    Prev Close  RIC
 Spot Gas Oil 0.5%                  71.81     0.44        0.62       71.37  GO-SIN
 GO 0.5 Diff                        -3.53    -0.02        0.57       -3.51  GO-SIN-DIF
 Spot Gas Oil 0.25%                 71.95     0.44        0.62       71.51  GO25-SIN
 GO 0.25 Diff                       -3.39    -0.02        0.59       -3.37  GO25-SIN-DIF
 Spot Gas Oil 0.05%                 74.89     0.45        0.60       74.44  GO005-SIN
 GO 0.05 Diff                       -0.45    -0.01        2.27       -0.44  GO005-SIN-DIF
 Spot Gas Oil 0.001%                75.74     0.36        0.48       75.38  GO10-SIN
 GO 0.001 Diff                       0.39    -0.11      -22.00        0.50  GO10-SIN-DIF
 Spot Jet/Kero                      74.77     0.41        0.55       74.36  JET-SIN
 Jet/Kero Diff                      -0.56    -0.04        7.69       -0.52  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 Anil D'Silva)
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