Gasoline: Non-oxy prices capped with high stocks levels in Singapore

Prices for non-oxy gasoline markets were not changed in Northeast Asia. However, supply/demand fundamentals were sluggish and the markets prices were capped. The arbitrage from Asia for the US was narrowed and it was hard for companies in Asia to transport cargoes. According to a source, the stocks remained at high levels although it slightly declined.

CPC in Taiwan sold one MR-size cargo of 95RON Non-oxy gasoline loading in early April at a premium below $3.00/bbl to the quotations on an FOB basis on Mar 11. The company sold one MR-size cargo of 95RON gasoline loading in early March at a premium of low $$3's/bbl to the quotations on an FOB basis on Feb 12. The premium shrank on a month

In Southeast Asia, sales for late March-loading cargoes were heard from Vietnam. It was heard that domestic demand was weak in the country. Buying interest from Indonesia, a main importing country was continued to be weak.

Naphtha: China's Wanhua conducts buy tender for Apr cargo

The second half April open-spec naphtha prices on a CFR Japan basis gained. Demand for new naphtha cracker was continued in China. Supply was certainly thin due to turnaround at refineries.

Wanhua Chemical in China conducted a buy tender for an MR-size or LR1-size cargo for delivery on Apr 10-30. The market source mentioned that Wanhua seemed to have strong buying interest and would likely to increase procurements volumes.

According to the source, several new naphtha crackers in China including Wanhua were supplied for naphtha from independent refineries in Shandong. However, the operation rates of independent refineries were low and supply was thin at present, so that Wanhua was trying to stock naphtha with imports.

It attracted attentions whether the arbitrage volume would increase again or not in the future. A trader pointed out that cargoes were transported from other regions like Europe and the US inevitably when the price spread widens between Asia and those regions, so that current tight supply/demand fundamentals might retreat going forward.

On the logistics, berths schedules in Fujairah, UAE were reportedly so congested and loading works were delayed. However, according to a source, end-users in Asia did not show alternate demand due to delivery delays and demand for heavy grades naphtha seemed to be slowing down compared to the past few months.

Middle distillates: Buying interest for Apr Jet fuel weak as CHN oversales in March

The differential for MR-size cargoes of jet fuel on an FOB Northeast Asia basis was not changed. No fresh sales were heard in the spot market. Buying interest for early April-loading cargoes did not increase as sales cargoes for march-loading was significantly high from China.

Inquiries for jet fuel from Japan by trading houses were decreasing. They had been importing jet fuel from South Korean oil companies with SR-size cargoes for tanks at Narita Airport. However, Cosmo oil and ENEOS had recently strengthened their supply mainly for tanks at the airport. Cosmo had ample refining capacity for the time being as the company was only scheduled to have turnaround of its 100,000 barrels per day Sakai refinery in the coming fall. It was strengthening its domestic sales of jet fuel, and this had reduced the tight supply/demand fundamentals for jet fuel, especially at Narita. Profitability of trading firms to import jet fuel from South Korea was declining, so that they were forced to curb their imports.

The differential for MR-size cargoes of 0.001% sulfur gasoil on an FOB South Korea basis was at a discount in the range of 65-75cts/bbl to Singapore quotations, while the differential for MR-size cargoes on an FOB Taiwan basis was at a discount of 25-35cts/bbl to the quotations, both widening by 15cts/bbl from a day before. The discount widened as the paper swaps market in Singapore formed the backwardation structure.

Fuel oil: Northeast Asia's 380cst stays steady

The differential for MR-size cargoes of 3.5% sulfur fuel oil (380cst) on an FOB South Korea basis was unchanged. However, the 380cst market remained solid on tight supply.Some South Korean oil firms seemed to be interested in high sulfur fuel oil (HSFO), which was becoming profitable compared with low sulfur fuel oil (LSFO), pointed out a market participant familiar with the matter. Even other oil companies reluctant to increase HSFO productions might import HSFO for resale.

Kuwait Petroleum Corporation (KPC) sold 60,000/mt of 2.5%S fuel oil via a tender for loading between Mar 21 and 26. The tender was awarded at a premium of $15-20/mt to Middle East quotations. The premium seemed to be at a slight premium to Singapore quotations (380cst).