SINGAPORE: Asian refining margins for jet fuel dipped on Monday to their weakest in over six weeks on the back of firmer crude prices, while cash discounts for the aviation fuel widened due to weaker bids and offers in the physical market.
The jet fuel market is currently muted as traders are waiting for winter demand to pick-up from next month, market watchers said.
Cash differentials for jet fuel <JET-SIN-DIF> widened their discounts to 14 cents a barrel to Singapore quotes on Monday, compared with a discount of 4 cents a barrel on Friday.
Jet fuel refining margins fell to $14.78 a barrel over Dubai crude on Monday, the lowest since Aug. 9. Jet margins were at $15.04 a barrel on Friday.
Meanwhile, refining margins, or cracks for 10 ppm gasoil fell to $16.03 a barrel over Dubai crude during Asian trading hours, compared with $16.34 a barrel on Friday.
Asia’s cash premiums for 10ppm gasoil <GO10-SIN-DIF> slipped to 82 cents a barrel to Singapore quotes, from 89 cents a barrel on Friday.
SINGAPORE CASH DEALS
Three gasoil deals, no jet fuel trades.
Total sold 158,000 barrels of 10ppm gasoil to BP for Oct. 10-14 loading at a premium of 80 cents a barrel to Singapore quotes.
Total sold 150,000 barrels of 10ppm gasoil to Winson Oil for Oct. 9-13 loading at a premium of 70 cents a barrel to Singapore quotes.
Total sold 165,000 barrels of 10ppm gasoil to Lukoil for Oct. 12-16 loading at a premium of 70 cents a barrel to Singapore quotes.
Japanese refiner Cosmo Oil has replaced its Iranian crude oil imports with supplies from other Middle Eastern producers ahead of the implementation of U.S. sanctions on Iran in November, top company executives said.
Oil prices jumped more than 2 percent to a four-year high on Monday after OPEC declined to announce an immediate increase in production despite calls by U.S. President Donald Trump for action to raise global supply.
Oil prices could rise towards $100 per barrel towards the end of the year or by early 2019 as sanctions against Iran bite, commodity merchants Trafigura and Mercuria said on Monday at the Asia Pacific Petroleum Conference (APPEC) in Singapore.
– With oil traders forecasting crude oil to rise to $100 a barrel by the end of the year, Indian refiners are considering cutting back their imports and relying more on cheaper crude already stored in inventories, according to industry executives.
– Saudi’s Aramco Trading Company (ATC) expects to increase its oil trading volume to 6 million barrels per day (bpd) in 2020, 50 percent higher than current levels, the company’s top official said on Monday.–Reuters