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Weekly Summary

Products: Jan 11-15: Korea kerosene remains amid completion of buying

GASOLINE

The differential for MR-size cargoes of 92RON gasoline was unchanged. Refiners in Northeast Asia were talking on spot cargoes loading in February. Last Friday, West Pacific Petroleum Co Dalian (WEPEC) closed a sell tender for an MR-size cargo of 93RON gasoline loading on Feb 8-10, but the results of the tender were unknown. As reported, last weekend, Formosa Petrochemicals Co (FPCC) in Taiwan sold two 250,000bbl cargoes of 93RON gasoline loading on Jan 29 to Feb 2 and Feb 1-5 both at a premium of 60cts/bbl to Singapore quotations on an FOB basis.

 

NAPHTHA

In the Northeast Asian market for second-half February delivery, prices for paraffinic naphtha were slightly decreasing. As one of factors, an end-user in Northeast Asia saw that demand of heavy and open-spec grades were recovering, and need of paraffinic naphtha slightly settled down. Further, another market source viewed that supply was surplus on the impact of opening arbitrage inflows from Europe and the US due to the profitability and increasing cargoes from the US which were coming after the delay in the Panama Canal.

 

MIDDLE DISTILLATES

The differential for SR-size cargoes of kerosene on an FOB South Korea basis was unchanged. Due to the cold snap for the past few days and expectations of procurements by refiners in Japan, there seemed to have been some movements of traders to procure cargoes. However, it was also pointed out that the movements were only marginal. A refiner in Japan was interested in procurement of kerosene from another refiner in the country or import volumes, so that it was not making moves to buy volumes by in-tank transfer at Tomakomai in Hokkaido. Japanese trading houses stayed in a wait-and-see stance, so that prices would not increase on Tuesday.

 

FUEL OIL

The differential for MR-size cargoes of 0.3% sulfur fuel oil on an FOB South Korea basis was unchanged. In South Korea and Japan, heating demand was strengthening due to the sever cold weather, so need of low sulfur fuel oil for power generation would likely extend further. Instead, whether buying for 0.3% sulfur fuel oil in the international markets would be actually seen or not was unknown. In the meantime, CPC in Taiwan bought two cargoes of 0.3% sulfur fuel oil arriving in February as totally 80,000mt through a tender last Friday. The prices were not informed, but it seemed to be the same level as the previous deal. CPC seemed to have purchased the two cargoes because Taipower which is the supply destination was trying to stock low sulfur fuel oil as the fuel of generating power. Further, CPC was planning a tender to buy one 40,000mt cargo of the fuel in February.

 

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