February 3, 2020 / 11:17 AM / 25 days ago

Asia Distillates-Jet fuel refining margins drop further

    SINGAPORE, Feb 3 (Reuters) - Asian refining margins for jet fuel weakened further on Monday
after posting their biggest monthly decline in more than a decade in January.
    A virus epidemic, which originated in the Chinese city of Wuhan, has hit aviation demand
amid extensive travel restrictions, while global airlines suspended flights to China.
    Refining margins, also known as cracks, for jet fuel dropped to $8.64 per
barrel over Dubai crude during Asian trading hours on Monday, a level not seen since April 2016,
Refinitiv Eikon data showed. The cracks were at $9.61 per barrel on Friday.
    The cracks dropped 34% in January, their steepest monthly decline, according to Refinitiv
Eikon data, which goes back to as far as April 2009.
    The death toll from coronavirus has risen to 361 and has spread to more than two dozen other
countries, while the World Health Organization has declared the outbreak a public health
emergency of international concern.
    Demand for jet fuel is expected to fall within a range of 170,000-300,000 barrels per day
due to travel curbs, trade sources and industry analysts said.
    Cash premiums for jet fuel JET-SIN-DIF slipped to 16 cents per barrel over Singapore
quotes on Monday, compared with a premium of 31 cents per barrel on Friday.
    Meanwhile, cash premiums for 10 ppm gasoil in Singapore GO10-SIN-DIF rose 20 cents to 48
cents per barrel to Singapore quotes on Monday, backed by firmer deals in the Singapore trade
    Refining profit margins for gasoil with 10 ppm sulphur content fell to $11.04
per barrel over Dubai crude on Monday, down from $11.48 per barrel on Friday.
    - China's Sinopec Corp, Asia's largest refiner, is cutting throughput this month
by around 600,000 barrels per day (bpd) as the rapidly spreading coronavirus hits fuel demand,
four people with knowledge of the matter said on Monday.
    - The cut is equivalent to roughly 12% of the state refiner's average daily throughput last
    - Sinopec asked refineries last Friday to cut production and gave plants different reduction
targets based on local fuel demand and logistics, the sources told Reuters. They declined to be
named as they are not authorized to speak to media.
    - Six gasoil trades, one jet fuel deal.
    - For more information, click
    - Brent crude prices fell on Monday to their lowest in more than a year, dragged down by
worries about lower demand in China, the world's largest oil importer, following a coronavirus
    - Independent refineries in China's eastern Shandong province that collectively import about
a fifth of the country's crude have slashed output by 30% to 50% in just over a week as the
coronavirus outbreak hit fuel demand and distribution, executives and analysts said.

 CASH ($/T)             ASIA CLOSE       Change   % Change   Prev Close   RIC
 Spot Gas Oil 0.5%                64.33    -1.97      -2.97        66.30  GO-SIN
 GO 0.5 Diff                      -1.88     0.02      -1.05        -1.90  GO-SIN-DIF
 Spot Gas Oil 0.25%               65.04    -1.97      -2.94        67.01  GO25-SIN
 GO 0.25 Diff                     -1.17     0.02      -1.68        -1.19  GO25-SIN-DIF
 Spot Gas Oil 0.05%               66.16    -1.99      -2.92        68.15  GO005-SIN
 GO 0.05 Diff                     -0.06    -0.01      20.00        -0.05  GO005-SIN-DIF
 Spot Gas Oil 0.001%              66.70    -1.78      -2.60        68.48  GO10-SIN
 GO 0.001 Diff                     0.48     0.20      71.43         0.28  GO10-SIN-DIF
 Spot Jet/Kero                    63.51    -3.19      -4.78        66.70  JET-SIN
 Jet/Kero Diff                     0.16    -0.15     -48.39         0.31  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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