Asia Naphtha/Gasoline-Gasoline margins reach two-week high; naphtha backwardation narrows

Asia’s gasoline margins climbed on Tuesday to more than a two-week high as 750,000 barrels of the benchmark grade of octane exchanged hands at the closing window.

The crack rose to $6.02 per barrel over Brent crude, its highest since Oct. 18.

Saudi Aramco emerged as the biggest seller yet again, as it sold 400,000 of 92-octane gasoline at the end of the trading day.

In naphtha, the margins slipped to more than a week low to $111.40 per metric ton over Brent crude, its lowest since Oct. 25.

The backwardation between the second-half December and the second-half January narrowed to $6.25.

Regional traders shared concerns that despite heading into the winter season, they do not expect the depressed margins to pick up for the time being.

NEWS

Oil prices traded in a narrow range on Tuesday ahead of what is expected to be an exceptionally close U.S. presidential election, after rising more than 2% in the previous session as OPEC+ delayed plans to hike production in December.

Saudi Arabia logged a budget deficit of 30 billion riyals ($8 billion) in the third quarter, more than half of the country’s total deficit so far this year, as lower oil prices weighed on revenue and spending surged.

Trading firms will deliver about 5 million barrels of Middle East crude oil to the Shanghai International Energy Exchange (INE) this month, an unusually large volume, after domestic prices rose against global benchmark Brent, trade sources said.

SINGAPORE CASH DEALS O/AS

Twelve gasoline deals and two naphtha trades.
Source: Reuters (Reporting by Haridas; Editing by Vijay Kishore)