Gasoil margins post weekly gain on buying sentiment, oil

Asia’s 10 ppm sulphur gasoil margins gained by 16% week on week against a backdrop of firmer oil futures and overall stronger buying sentiment on expectations of lower January exports from China.

Potentially tighter supply elsewhere in Asia, given some production switches from gasoil to jet fuel because of the smaller regrades, buoyed margins.

Uncertainty in Europe market fundamentals, ahead of potential strikes, contributed to late week gains – even though the arbitrage between Asia and northwest Europe only went up slightly since early week.

Refining margins (GO10SGCKMc1) for 10 ppm closed the week at $34.87 a barrel, while jet fuel refining margins (JETSGCKMc1) firmed to $32.87 a barrel.

Regrade (JETREG10SGMc1) as a result narrowed to $2 a barrel.

Cash differentials (GO10-SIN-DIF) for 10 ppm sulphur gasoil closed at the week’s high of $1.94 a barrel.

SINGAPORE CASH DEALS

– One gasoil deal, no jet fuel deal.

INVENTORIES

– Gasoil stocks held in independent storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage area rose further to their highest since October 2020 in the week to Thursday, data from Dutch consultancy Insights Global showed. Gasoil stocks rose to 2.083 million tonnes, due to strong imports from China and Russia ahead of a Feb. 5 European ban on Russian diesel imports, Insight Global’s Lars van Wageningen said.

NEWS

– Oil prices rose on Friday, on track for gains of more than 6% for the week, on solid signs of demand growth in top oil importer China and expectations of less aggressive interest rate rises in the United States.
Source: Reuters