Gasoline: Non-oxy market down, supply for oxy from China tends decreasing

　 The differential for MR-size cargoes of non-oxy grade went down. Backwardation in the Singapore futures market and continuously rising freight rates, along with perceived procurement risks for late October loading, slightly weighed on the market.

　 In talks for oxy-grade products, according to a market source, Vietnam has extended tax incentives for gasoline and gasoil imports until the end of 2026. China, a major supplier of oxy-grade products, was estimated to have exported around 400,000mt in October. According to the country's statistics, its August export volume was around 700,000mt. Furthermore, its September export volume is estimated at around 600,000mt, and the decreasing trend for cargoes from China was likely to continue.

Naphtha: Market softens with increasing Oct cargoes from other regions

　 The first half November open-spec naphtha prices on a CFR Japan basis declined. Tight supply/demand fundamentals slightly eased, leading to the narrower premium. According to a market source, ample quantities of cargoes from regions outside Asia expected to arrive in Asia in October eased near-term supply concerns, reportedly becoming a bearish factor for the November delivery market. Additionally, naphtha imports in China reportedly lacked growth.

　 Hanwha TotalEnergies (HTC) in South Korea purchased heavy full range for first-half November delivery via a tender last week. According to a market source, the price was reportedly at a premium of $47/mt for A-grade, a premium in the high $30's/mt for B-grade, and a premium in the high $20's/mt for C-grade on a CFR basis to first-half October quotations. The heavy full range market remained firm. A Singapore trader pointed out that the heavy full range market was supported by strong aromatics and gasoline markets.

Middle distillates: Markets pulled down by high freights and narrower arbitrage

　 The differentials for MR-size cargoes of jet fuel on an FOB Northeast Asia basis softened. Rising freight rates caused the arbitrage window for the US, a major destination of jet fuel, to shrink. Meanwhile, a certain amount of sales was seen from South Korea. Additionally, Chinese players were highly likely to start selling cargoes loading in October, which led to a perceived sense of slack fundamentals in the region, although details were still unclear. GS Caltex in South Korea sold an MR-size cargo loading on Oct 23-27 via a tender closed on Tuesday at a premium of around 25cts/bbl to the quotations on an FOB basis.

　 The differentials for MR-size cargoes of 0.001% sulfur gasoil on an FOB Northeast Asia basis sharply went down. Deterred by high Asian prices, major buyers who were targeting to move cargoes to Australia and Southeast Asia were curbing procurement volumes. Additionally, soaring freight rates caused the arbitrage window for Europe to shrink. A decrease in export volumes to outside the region also became a bearish factor for the market. The awardable price for MR-size cargoes of 0.001% sulfur gasoil loading in late October from South Korean was reportedly heard at a discount of $1.60-1.70/bbl to the quotations on an FOB basis.

Fuel oil: Japan's Cosmo sells low sulfur cargo

　 The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis weakened. On the other hand, the differential for MR-size cargoes of 0.3% sulfur fuel oil on an FOB South Korea basis was unchanged. Buying interest for the low sulfur fuel oil market varied by quality, resulting in mixed movements.

　 Against the backdrop of soaring freight rates and backwardation in the futures market, a supplier reported that the awardable price for second-half October-loading 0.5% sulfur fuel oil was heard at a discount of around $35.00/mt to the quotations on an FOB basis.

　 Meanwhile, in the Singapore market, as demand for very low sulfur fuel oil was increasing as a blending component for bunker fuel, the 0.3% sulfur fuel oil market remained firm. Cosmo Oil in Japan sold 30,000mt of low sulfur fuel oil (0.24%S) for mid-October loading in Chiba last Friday in a premium range on an FOB basis. This cargo was destined for South Korea, and was likely to be used as a feedstock for secondary units.