Supply/demand would slacken with start-up of refineries

-Gasoline-
Many players expect that perceptions of loose supply/demand of gasoline would unlikely disappear in 2025. In China, economy remains sluggish even after the COVID-19 pandemic ended. Also, China is focusing to increase new energy vehicle (NEV) and demand for gasoline is shrinking. Meanwhile, new facilities started up and supply is rising. In Mexico, 340,000 bbl/day (b/d) Olmeca refinery started up in 2024. In Nigeria, 650,000b/d Dangote refinery began commercial operations in the same year. In Kuwait, operations of the 615,000b/d Al Zour refinery is getting stable. Dangote refinery is picking up speed to export gasoline, which results in surplus of Middle East cargoes. Therefore, traders are actively sending Middle East cargoes to Asia.

-Naphtha-
Supply/demand of naphtha is expected to remain dull. Several major naphtha crackers plan to start up in China and demand for naphtha is forecast to be met with domestic refinery cargoes to some extent. Market players pointed out, "Chinese players can choose cheaper naphtha from imported and domestic refinery cargoes. Imports would unlikely surge." On the other hand, the petrochemical market is sluggish. While feedstock crude oil and naphtha prices does not weaken, the olefine market lacked upward momentum due to slack supply/demand fundamentals. Under such circumstances, if new naphtha crackers start up, olefine would be oversupplied even more, which might slacken supply/demand and weighed down the market. Market players forecast that operation rates of existing naphtha crackers in China and outside China would decrease to maintain profitability of olefine.

-Gasoil and Jet fuel-
Supply/demand of gasoil is predicted to slacken. New refineries would start up in several areas and supply is expected to grow as mentioned above, but demand is forecast to be limited in the world. Especially, economy is anticipated to remain sluggish in Europe in 2025, which is a bearish factor. US President-elect Donald Trump insists that the US should raise tariff on imported goods. This seems to disrupt international trade and lower demand for gasoil. Northeast Asia oil companies held term discussions for gasoil for 2025 and prices were generally lower than 2024.

On the other hand, due to an increase in interstate movements, demand for jet fuel is anticipated to be firm. While use of sustainable aviation fuel (SAF) is rising, demand for exiting jet fuel would be firm, considering costs.

-Fuel oil-
The Asia fuel oil market would likely be affected by arbitrage cargoes supplied from outside the region. Outside Asia, major refineries including Al Zour refinery and Dangote refinery are fully operating and several low sulfur fuel oil cargoes of over 100,000mt per month were brought to Asia, mainly Singapore, in some months. In 2025, several cargoes per month were expected to be supplied to Asia. However, market sources said "If supply to Asia decrease owing to rising demand in Europe and troubles at refineries, the market might advance." On the demand side, demand for vessel use would be influenced by Chinese economic situation.