Gasoline: China expected to export more cargoes, causing slack fundamentals

The differential for MR-size cargos of 92RON gasoline on an FOB South Korea unchanged. However, sales from China were expected to gain momentum going forward, and it was perceived that supply from the country would increase. As reported before, the Chinese government notified the third batch of export quotas of oil products this year on Tuesday night, and oil companies in the country were striving to decide export plans. PetroChina, one of the main exporters of the fuel in the country, was likely to start sales of the fuel from next week.

The regular maintenance season of refineries were over in China, and the gasoline refining margins over Dubai crude oil stayed firm. On the demand side, as reported, purchases from Indonesia continued. While sales from China had been scarce for a while, procurements by state-owned Pertamina were not smooth. Thus, the company was repeating to issue buy tenders, a market source said.

Naphtha: JPN company buys 1H Nov cargo

The first half November open-spec naphtha prices on a CFR Japan basis went down. While supply from Russia was expected to decrease going forward, the operation rates of naphtha crackers continued to be capped in Asia. A petrochemical company said that a sense of tight fundamentals was not so strong and density of delivered naphtha was relatively heavy. In the spot talks, Japan's Asahi Kasei Mitsubishi Chemical Ethylene Corp (AMEC) conducted a buy tender for 25,000mt of open-spec naphtha for delivery in the first half of November via a tender closed on Tuesday.

On the other hand, demand in Europe was currently firm. Naphtha was being consumed for a gasoline blending. According to a market source, refineries in Europe were producing gasoline for Africa.

Middle distillates: 500ppm GO market weakens with strong sales from Korea

The differentials for MR-size cargoes of jet fuel on an FOB Northeast Asia basis unchanged. The Chinese government had announced the third batch of export quotas of oil products, but movements of oil companies to sell cargoes loading in October were slow. Some were thinking twice of their plans for the time being as the third batch was smaller than the initial market expectations.

The differentials for MR-size cargoes of 0.05% sulfur gasoil on an FOB Northeast Asia basis went down. One sale after another from South Korea caused slack market fundamentals in the region. In Asia, prices for 0.05% sulfur gasoil were higher than jet fuel, so that sellers were focusing on the grade in terms of profitability. S-Oil Co in South Korea sold two MR-size cargoes loading on Oct 22-26 and Oct 27-31 via a tender Meanwhile, GS Caltex had sold an MR-size cargo loading on Oct 26-30.

Fuel oil: Sales from Dangote continue

The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis unchanged. However, in Asia especially in Singapore, inventories of fuel oil stood high, demand of low-sulfur fuel oil for power generation was expected to decline going forward toward the off-demand season of power. On the other hand, sales in the spot market were witnessed in part due to refinery troubles in the region.

The 650.000b/d Dangote refinery in Nigeria conducted a tender to sell 130,000mt of low-sulfur straight run fuel oil (0.5%S) loading on Oct6-8. It was scheduled to close on Sep 19. As reported before, the residue fluid catalytic cracker (RFCC) had stopped operations at its refinery.