Oil report

Asia Distillates-Jet fuel cash differentials climb to strongest in nearly 6 weeks

    SINGAPORE, Oct 6 (Reuters) - Asia's cash differentials for jet fuel gained for a fourth
consecutive session on Tuesday, to their smallest discounts in more than a month, helped by a
pick up in buying interests in the physical market over the last week.
    Cash discounts for jet fuel JET-SIN-DIF were at 50 cents a barrel to Singapore quotes on
Tuesday, a level not seen since Aug. 26. The spot differentials were at a discount of 69 cents
per barrel a day earlier.
    Refining margins, also known as cracks, for jet fuel in Singapore jumped to
their highest in over two months, rising 66 cents on Tuesday to trade at $2.08 per barrel over
Dubai crude during Asian trading hours.
    The jet profit margins have found support as run cuts at regional refineries helped drain
out excess supplies, while Japan and South Korea have started stockpiling kerosene ahead of
winter, when the fuel is used for residential heating. 
    Winter months usually prop up jet fuel refining margins as kerosene belongs to the same
grade of oil products, with jet margins determining the profitability of both.
    But with thousands of flights still grounded due to coronavirus restrictions, the persistent
weakness in Asia's aviation market is expected to outweigh the demand boost from the uptick in
seasonal kerosene consumption, industry analysts said.
    "Jet/kero margins will likely receive a small boost from winter residential heating demand
in Northeast Asia... (But) it is a marginal boost, maybe just $1 per barrel in terms of the
crack," JBC energy market analyst Philip Jones-Lux said.
    Until the global air fleet takes flight again in serious numbers, the overall outlook for
jet fuel will remain pessimistic, traders and analysts said.
    - Two jet fuel trades, two gasoil deals
    - Oil prices gained on Tuesday due to fears that refineries could be hit by a storm brewing
in the Gulf of Mexico, while buyers also drew relief from U.S. President Donald Trump's return
to the White House after being treated for COVID-19 in hospital.
 CASH ($/T)             ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%                42.75     1.32       3.19       41.43  GO-SIN
 GO 0.5 Diff                      -1.96    -0.06       3.16       -1.90  GO-SIN-DIF
 Spot Gas Oil 0.25%               43.15     1.32       3.16       41.83  GO25-SIN
 GO 0.25 Diff                     -1.56    -0.06       4.00       -1.50  GO25-SIN-DIF
 Spot Gas Oil 0.05%               43.57     1.32       3.12       42.25  GO005-SIN
 GO 0.05 Diff                     -1.14    -0.06       5.56       -1.08  GO005-SIN-DIF
 Spot Gas Oil 0.001%              44.16     1.45       3.39       42.71  GO10-SIN
 GO 0.001 Diff                    -0.56     0.05      -8.20       -0.61  GO10-SIN-DIF
 Spot Jet/Kero                    42.35     2.16       5.37       40.19  JET-SIN
 Jet/Kero Diff                    -0.50     0.19     -27.54       -0.69  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 Ramakrishnan M.)