Gasoline: Oxy market softens on backward amid weak purchases by end-users

　The Oxy market for MR-size cargoes of gasoline on Northeast Asia basis went down. The market was easily pushed down by the current sharp Apr/May backwardation in the Singapore futures market. Meanwhile, end-users were decreasing buying interest because prices for oil products were expected to go up going forward with a rise in the strong crude oil prices. In talks on a component MTBE, supply for the material was enough in the area around Singapore, it was heard.

　In this situation, for 92RON gasoline loading in late April, possible deal levels for MR-size cargoes were heard to be in the mid-single digit premium to the quotations on an FOB South Korea basis.

　In spot talks, Indonesia state-owned Pertamina conducted a buy tender for total 900,000bbl of 92RON gasoline that was closed on Mar 30. The price validity was set on Apr 1.

Naphtha: JPN petchem company buys spot cargo

　The second-half May open-spec naphtha prices on a CFR Japan basis were stable. Supply disruptions from the Middle East remained a bullish factor. In the spot market, buyers could get offers because trading houses and traders continued to bring cargoes from the US, Europe and India. Japan's Maruzen Petrochemical reportedly bought a cargo for delivery in the second-half May on Apr 2. The awarded price was heard higher than the current market prices because it restricted a delivery-date period and specs.

　In talks on ethylene, prices were hovering at high levels. Supply remained tight since several naphtha crackers shut down operations or reduced the operational rates due to a shortage of naphtha. In this situation, a part of Chinese ethylene producers cut the operational rates of derivatives facilities with a fall in profits and was shifting to sell ethylene instead. Meanwhile, at least one cargo of the material was scheduled to be exported from the US in May that was supposed to arrive in Asia in June.

Middle distillates: GS Caltex sells 500ppm for Apr at large premium

　The differentials for MR-size cargoes of jet fuel on an FOB Northeast Asia basis unchanged. Multiple market players reported the possibility that a surplus would emerge in supply/demand fundamentals within Asia from April onwards. Aviation demand was expected to decrease from April, mainly in Southeast Asia. Several airlines in Vietnam and the Philippines had already decided on flight reductions from April. In addition, if there were flight reductions from Southeast Asia to Northeast Asia, "There is a high possibility that refueling at arrival airports, such as in Japan, will decrease," according to a Japanese refiner. For this reason, voices were heard that demand would decline across the entire Asian region. On the other hand, many US and Indian cargoes were flowing into the region. As Asian prices had remained at high levels compared to Europe and the US, there were moves to divert cargoes originally bound for Europe back to Asia for March and April loading.

　Taiwan's CPC Corp was considering purchasing at least one MR-size cargo for arrival in May onward. The company tended to procure cargoes every month for domestic aviation demand in Taiwan.

　The differentials for MR-size cargoes of 0.05% sulfur gasoil on an FOB Northeast Asia basis went up. Strong buying inquiries from Southeast Asian market players served as a bullish factor for the market. Sales for April-loading cargoes from South Korea surfaced. GS Caltex sold one MR-size cargo of 0.05%S gasoil for Apr 14-18 loading through a tender closed on Apr 1. The awarded price was at a premium of around $25.00/bbl to the quotations on an FOB basis. In Vietnam, PV Oil reportedly attempted to buy April-arrival 0.05%S gasoil multiple times through tenders and private negotiations. However, no deals were concluded as selling ideas remained high. As previously reported, Petrolimex also issued a buy tender for gasoil and jet fuel last week, but these had not been awarded either.

Fuel oil: Sense of tight supply easing

　The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis was unchanged. But a sense of tight supply slightly eased in Singapore. This was because the situation in the Middle East did not impact on supply of low sulfur fuel oil as earlier expected and traders had hold enough inventories. Although last-minute demand occurred previously, it already calmed down. Floating prices and the price spread between fuel oil paper swap values and bunker oil was narrowing.

　In the spot market, PTT in Thailand sold 35,000mt of 0.5%S fuel oil loading on Apr 24-26 via a tender. The price was reportedly at a discount in the mid $10's/mt to the quotations on an FOB basis. In mid-March, CPC Corp in Taiwan also bought two 36,000mt cargoes of 0.3%S fuel oil arriving in May. The cargoes were for Taiwan Power Company,