GASOLINE

The differential for MR-size cargoes of 92RON gasoline on an FOB Northeast Asia basis weakenined. Some bearish factors were seen in the market. In the paper swaps market in Singapore, the backwardation between November and December contract stayed at around $1.50/bbl. Therefore, the downward pressure for cargoes loading in the second half of November were strengthening. In addition, supply/demand fundamentals of gasoline in Asia were slackening. Whereas exports from China were increasing in November, demand in Indonesia was sluggish. On Wednesday, a refiner in China sold an MR-size cargo of 92RON gasoline loading from South China at the end of November at a premium of around 20cts/bbl to Singapore quotations on an FOB basis.

NAPHTHA

Recent freights to Japan from the Middle East and Singapore were almost recovering to the level before the surge. Further, sanctions by the US to COSCO Shipping in China whose numbers of tankers were decreasing were easing as the sails in some areas as Malaysia were slightly recovering. Owing to this, arbitrage volumes from Europe and the US to Asia would likely be accelerated to increase from now on, and supply in Asia would be abundant.

MIDDLE DISTILLATES

The differentials for MR-size cargoes of 0.001% sulfur gasoil on an FOB Northeast Asia basis were down. Amid discussions shifting to cargoes loading in the second half of November, the backwardation structure in the paper swaps market pushed down the differentials. IN the Singapore paper market, the backwardation between November/December stayed at around 90cts/bbl. In addition, the premium for 0.001% sulfur gasoil in Singapore kept falling. In Northeast Asia, 0.001% sulfur gasoil cargoes seemed to be supplied from China and Japan, but deals had yet to be heard. However, the discussion level for cargoes from Japan was said to be at a discount of around 10cts/bbl to the quotations on an FOB basis.

FUEL OIL

The differential for MR-size cargoes of 3.5% sulfur fuel oil on an FOB South Korea basis was up on tightness in supply. A South Korea oil company mentioned that one of South Korean refineries was already stopping supply of high sulfur fuel oil toward the severer sulfur regulation for marine fuel from the next year by International Marine Organization (IMO). Due to that, supply for high sulfur fuel oil was more and more tightening. Also, the widening in premiums for high sulfur fuel oil in Singapore market was a bullish factor.

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