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Weekly Summary

Products: Jan 4-8: Korea jet oil declines amid COVID-19 outbreak


Differentials for MR-size cargoes of 92RON gasoline on an FOB Northeast Asia basis were unchanged. However, talks on spot cargoes loading in February by Northeast Asian refiners were gaining momentum. Formosa Petrochemicals Co (FPCC) in Taiwan was conducting a sell tender for two 250,000bbl cargoes of 93RON gasoline loading on Jan 29 to Feb 2 and on Feb 1-5. The tender was closed on Thursday. In South Korea, GS Caltex was making moves to sell an MR-size cargo of gasoline loading in February, but details were not known. In the meantime, as COVID-19 was still spreading, demand in Southeast Asia remained weak. No spot purchases were heard from Indonesia or Vietnam.



In Japan spot market, a state of emergency was declared on Jan 7 on the back of rapid spread for COVID-19, then drops in demand were concerned due to poor turnout. However, a Japanese market participant viewed that sales for new and old cars were rather extending as people were changing behavior to use cars individually and demand of gasoline would be steady, so that the impact to markets for naphtha as the feedstock of gasoline would be small.



The differential for MR-size cargoes of jet fuel on an FOB South Korea basis weakened with sluggish demand. While COVID-19 was still spreading, demand for jet fuel remained weak. As reported, only some purchases for Japan were seen in the market. Therefore, outlets for cargoes from Northeast Asia were limited. In the meantime, exports from China seemed to be slightly increasing, but most of them were said to be brought into Hong Kong. In South Korea, GS Caltex was conducting a sell tender for an MR-size cargo of jet fuel loading on Feb 7-11. The tender was scheduled to close on Friday.



The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis was unchanged. One of South Korean oil companies said that bunker markets were firm in South Korea, but FOB Korea prices for 0.5% sulfur fuel oil as the feedstock of VLSFO for bunker did not rise up. On the other hand, in Taiwan, Formosa Petrochemical Co (FPCC) was informed to have sold 10,000mt pyrolysis fuel oil (PFO) loading in early January at a discount of $50.00-55.00/mt to Singapore quotations (0.5%S). The company was not planning more tenders to sell low sulfur fuel oil loading in January. Further, CPC in the county was valid for the tender to buy 40,000mt 0.3% sulfur fuel oil arriving in February on Thursday. The result was unknown so far.


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Tokyo : Products Team  Satoko Waki   +81-3-3552-2411Copyright © RIM Intelligence Co. ALL RIGHTS RESERVED.