Gasoline: Rising inquiries from Russia, falling demand from Vietnam

　 The differentials for MR-size cargoes were unchanged. In talks on oxy gasoline, strong inquiries for finished gasoline and MTBE from Russia were pointed out as supporting the market. According to a market source, inquiries seemed active for both western and eastern Russia. As previously reported, Russia was reportedly in a position to import around 200,000-300,000bbl/d. It was also heard that measures were being considered, such as requiring companies holding interests in Russian crude oil to import oil products into Russia instead of exporting crude oil.

　 Meanwhile, inquiries for Vietnam seemed to be declining. A market source pointed out that sales of E10 gasoline blended with 10% ethanol started across Vietnam from Jun 1, and consumption of conventional gasoline was probably falling.

Naphtha: 1H Sep delivery to Japan awarded at +$20

　 The main trading focus shifted to H1 Sep delivery. The differential for H1 Sep CFR Japan open-spec naphtha (OSN) was assessed at a premium of around $20.00/mt to Japan quotations, assessed 45 days prior to cargo arrival, strengthening by around $5.00/mt compared to H2 Aug delivery. Supply was tightening due to shrinking arbitrage, reduced Russian exports, and fewer tankers heading to the Strait of Hormuz. On the demand side, some market participants expect South Korean companies to strengthen their buying interest in the spot market. The South Korean government effectively banned naphtha exports for five months in late March. This policy resulted in naphtha produced at South Korean refineries circulating domestically, meeting a certain portion of petrochemical feedstock demand. Market sources pointed out that if the policy ends as scheduled, naphtha cracker operators will need to procure feedstock from overseas for Sep-loading cargoes and beyond.

　 On Wednesday, in the spot market, 25,000mt of H1 Sep CFR Japan OSN was reportedly dealt at a premium of around $20.00/mt to H2 Jul Japan quotations

Middle distillates: Inquiries for 10ppm for Central and South America firms

　 The differential for MR-size cargoes of jet fuel on an FOB Northeast Asia basis softened in the latter half of the week. The arbitrage window to Western markets narrowed, and buying interest aimed at arbitrage retreated. GS Caltex in South Korea sold one LR2-size cargo for late August loading via a tender on Thursday. The price was at a premium of around 40cts/bbl to Singapore quotations on an FOB basis. The company initially issued a sell tender for 300,000bbl each for loading on Aug 23-27 and Aug 26-30, but as buying ideas for these cargoes remained around flat to the quotations, it was reportedly changed to an LR2-size sale.

　 The differential for MR-size cargoes of 0.001% sulfur gasoil on an FOB basis strengthened. The arbitrage window to Central and South America, including Chile, were open, and inquiries were robust. Increased exports from the US to Europe had led to a sense of tight supply emerging in Central and South America. Additionally, the arbitrage to Europe also remained open, which was a bullish factor for Asian prices.

　 Amidst this, ENEOS and Cosmo Oil sold an MR-size cargo each of 0.001% sulfur gasoil for early August loading. ENEOS's cargoes were for loading from two ports, Sendai and Kawasaki. Cosmo Oil's loading point was not disclosed. Japanese refiners had increased their gasoil exports since July.

Fuel oil: Supply concerns for 0.5% sulfur growing again

　 The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis remained unchanged. Supply concerns re-emerged amidst a renewed deterioration of the Middle East situation. Buying interest from traders was notable in the Singapore market. This could be interpreted as a move to secure inventories, given the potential for reduced future supply due to the Middle East situation. Northeast Asian refiners were reportedly hesitant to export August-loading cargoes due to concerns over crude oil supply from September onward. Recently, no spot sales of low sulfur fuel oil had been observed in the region.

CPC Co in Taiwan was likely to restart the 80,000b/d residue fluid catalytic cracker (RFCC) at its 350,000b/d Talim refinery in late July. The RFCC had been shut down since early April due to a fire. At this stage, the company reportedly had no plans to sell low sulfur fuel oil cargoes for August loading.