Gasoline: Sales for non-oxy limited from Korea

　 The differentials for MR-size cargoes of non-oxy gasoline loading in Northeast Asia went up. In the spot market, supply for September-loading cargoes from South Korea was limited, leading to strong buying interest for tight availability. On the demand side, inquiries for Australia were firm. Additionally, with glitches occurring at several refineries in Japan, buying interest was shown from Japanese oil firms to overseas oil companies.

　 In the spot market, on Aug 24, an MR-size cargo of 92RON gasoline for mid-September loading in Japan was traded. The loading date was reportedly around Sep 13, and the price was reported at a premium in the low $4's/bbl to the quotations on an FOB basis.

　 Meanwhile, the oxy product market was capped, with widespread expectations of increased supply. According to a market source, China's export volumes could reach over 600,000mt in August and over 800,000mt in September. Export volumes in July were approximately 420,000mt.

Naphtha: 1H Oct OSN traded at +18 on CFR Taiwan basis

　 The differentials for the first half Oct-delivery open-spec naphtha on a CFR Japan basis were unchanged. Market sentiment was weak amid a sudden increase in the prospect of future supply recovery. Some traders expected that the monthly spread could narrow, anticipating a recovery in future supply. Underpinning the expectations for supply recovery was increased supply of crude and naphtha from the Middle East and higher refinery run rates.

　 In the spot market on Aug 26, Formosa Petrochemical Corp (FPCC) in Taiwan procured 25,000mt of open-spec for H1 Oct delivery at a premium of around $18/mt to H1 Sep Japan quotations on a CFR basis.

　 The South Korean government limited naphtha exports for five months from Mar 27. However, even after Aug 26, no lifting of the restrictions was announced by the government. According to a market source, information was received that the continuation of restrictive measures was being considered until around late Jan 2027.

Middle distillates: GO market down with strong selling interest with high crack margins

　 The Northeast Asia jet fuel market climbed. This was on the back of a flattening Sep/Oct backwardation in the Singapore futures market, reflecting receding expectations of lower future prices. Hyundai Oilbank in South Korea sold an MR-size cargo loading on Sep 28-30 at a discount of around 20cts/bbl to Singapore quotations on an FOB basis through a tender closed on Aug 25.

　 The differentials for MR-size cargoes of 0.001% sulfur gasoil on an FOB Northeast Asia basis softened. South Korean and Japanese firms, encouraged by firm crack margins, actively pushed sales for H2 Sep-loading cargoes, which put downward pressure on the market. Hyundai Oilbank in South Korea sold a 450,000bbl cargo loading on Sep 21-23 through a tender closed on Aug 26. One trader procured it at a discount of around $1.10/bbl to the quotations on an FOB basis.

　 In Japan, several oil firms sold cargoes. ENEOS sold an MR-size cargo loading on Sep 16-18 from two ports, Sendai and Sakai, last week. The price was at a discount of around 10cts/bbl to the quotations on an FOB basis. A European trader procured it.

Fuel oil: Sep/Oct backwardation formed at $40

　 The differentials for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis softened. In the Singapore futures market, the Sep/Oct spread was in backwardation of nearly $40.00/mt. This led to increased downside risk for procurements of late Sep-loading cargoes.

　 Additionally, in the bunker market, regional bunker demand was reportedly on a declining trend, with an increasing number of vessels bunkering in Europe and other regions.

　 Outside the region, it was heard that Nigeria's 650,000b/d Dangote refinery could increase sales of low sulfur straight run fuel oil in the future. The refinery was reportedly considering reducing operations of the residue fluid catalytic cracker (RFCC) due to glitches. According to a market source, the refinery had procured a total of around 23 mil bbl of crude oil for Sep delivery and was expected to run the crude distillation unit (CDU) at full capacity.