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Asia Distillates-Jet fuel cash discounts widen

Asia’s cash differentials for jet fuel widened their discounts on Tuesday, weighed down by fragile aviation demand amid coronavirus-led travel restrictions in the region.

Cash discounts for jet fuel JET-SIN-DIF were at 13 cents per barrel to Singapore quotes on Tuesday, compared with a discount of 12 cents per barrel a day earlier.

The front-month time spread for the aviation fuel in Singapore widened its contango by a cent on Tuesday to trade at a discount of 28 cents per barrel, Refinitiv Eikon data showed.

The virus outbreak, which originated from the central Chinese city of Wuhan, has led to scores of flight cancellations, hurting travel demand across the whole Asia Pacific region with the impact on future bookings spreading beyond China.

Refining margins or crack spreads for jet fuel crawled up 11 cents to $9.43 a barrel over Dubai crude during Asian trade on Tuesday as raw material crude oil prices fell.

Meanwhile, refining profit margins for gasoil with 10 ppm sulphur content also inched higher to $11.53 a barrel over Dubai crude, up from $11.47 per barrel on Monday.

Cash premiums for 10 ppm gasoil GO10-SIN-DIF were at 49 cents a barrel to Singapore quotes on Tuesday, up from 48 cents a barrel on Monday.

– One gasoil trade, no jet fuel deals

– Singapore trader Hin Leong sold 250,000 barrels of 10 ppm gasoil to Vitol for March 4-8 loading at a premium of 50 cents a barrel to Singapore quotes.

– Several Chinese independent refineries, or teapots, as the industry calls them, have snapped up crude supplies after prices slumped, betting that they are bottoming out and China’s demand could recover from a coronavirus outbreak in coming months.

– Oil prices fell by more than 1% on Tuesday, tracking losses in financial markets on lingering concerns over the economic impact of the coronavirus outbreak in China and its effect on oil demand.

 CASH ($/T)            ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%               64.78    -0.75      -1.14       65.53  GO-SIN
 GO 0.5 Diff                     -1.78     0.00       0.00       -1.78  GO-SIN-DIF
 Spot Gas Oil 0.25%              65.36    -0.75      -1.13       66.11  GO25-SIN
 GO 0.25 Diff                    -1.20     0.00       0.00       -1.20  GO25-SIN-DIF
 Spot Gas Oil 0.05%              65.63    -0.75      -1.13       66.38  GO005-SIN
 GO 0.05 Diff                    -0.93     0.00       0.00       -0.93  GO005-SIN-DIF
 Spot Gas Oil 0.001%             67.04    -0.75      -1.11       67.79  GO10-SIN
 GO 0.001 Diff                    0.49     0.01       2.08        0.48  GO10-SIN-DIF
 Spot Jet/Kero                   64.27    -0.71      -1.09       64.98  JET-SIN
 Jet/Kero Diff                   -0.13    -0.01       8.33       -0.12  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

Source: Reuters (Reporting by Koustav Samanta;)

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