December 21, 2011 / 10:59 AM / 7 years ago

Asia Distillates-Gasoil cracks rebound on demand

SINGAPORE, Dec 21 (Reuters) - Asia gasoil market
strengthened on Wednesday, with cracks inching up after spot
demand emerged from India and China.	
    The gasoil crack for January was up 25 cents to $17.91 a
barrel over Dubai crude on Wednesday.	
    Recent spot requirements by Indian Oil Corp for 60,000
tonnes of low sulphur gasoil and signs of diesel shortages in
south China are supporting Asian diesel prices, traders said.	
    China National Offshore Oil Corp (CNOOC), the country's
third-largest oil company, has bought small volumes of diesel
for delivery in late December for domestic use to help ease
shortages. 	
    The exact volumes purchased for December delivery could not
be verified, but one source familiar with the matter said it was
about 37,250 barrels bought from China's tax-bonded storage
facilities that usually do not enter the Chinese market.  	
    The volumes purchased will be used in the domestic market, a
second source said.  	
    Demand for gasoil to be used in the bunker market in South
China has also increased recently with sales being robust, a
refining source said, declining to provide actual volumes. 	
    China imported 202,091 tonnes, or 1.51 million barrels, of
diesel in November, up 37.7 percent from the same period last
year, official customs figures showed on Wednesday.
 	
    In Japan, kerosene stocks fell for the second time in the
past three weeks as the peak winter season began, after hitting
a three-year high in the week to Nov. 26. 	
    Stocks of kerosene for heating fell by 91,000 kl (87,000
barrels per day) to 3.45 million kl. Stocks peaked at 3.65
million kl in the week to Nov. 26, data from the Petroleum
Association of Japan (PAJ) showed on Wednesday. 	
    Bangladesh Petroleum Corporation (BPC) has concluded 2012
term negotiations with six suppliers for diesel and jet fuel at
stronger premiums than its current contracts. 	
     BPC finalised its diesel term contract for the first half
of 2012 at a premium of $3.50 a barrel to Middle East quotes, up
from the $3.30 a barrel premium for its July to December term
cargoes this year.  	
   The term contract for jet fuel has been fixed at a premium of
$4.50 a barrel, up from $4.30 a barrel.  	
    	
    For exchange of futures for swaps (EFS) curve, click
   	
	
    * SWAPS OUTRIGHTS: Gasoil's January and February swaps
increased by $2.75 and $2.77 to $122.00 and $121.22 a barrel,
respectively.	
    - Jet fuel swaps for January gained $2.70 to $122.40 while
the January regrade, or the difference between jet and diesel
prices, fell 5 cents to a premium of 40 cents a barrel. 	
      	
    * CRACKS: Gasoil's crack for January was up 25 cents to
$17.91 a barrel over Dubai crude.        	
    - Jet fuel's January crack gained 20 cents to $18.31 a
barrel.   	
      	
    * EAST-WEST SPREADS: The Exchange of Futures for Swaps (EFS)
for January fell $3.10 to minus 76 cents a tonne. 	
	
    * CASH DIFFERENTIALS: The premiums for the 0.5 and 0.25
percent sulphur gasoil gained 4-5 cents to 60 cents and $1.50 a
barrel respectively while jet fuel differential remained the
same at a discount of 55 cents a barrel to Singapore quotes. 	
                                  	
    * PHYSICAL OUTRIGHTS: Benchmark diesel with a maximum
sulphur content of 0.5 percent was up $2.77 to $122.72 a barrel,
while jet fuel gained $2.71 to $121.84 a barrel.	
      	
    * TENDERS: No new tenders issued. 	
              	
    * CASH DEALS: No jet deal, one gasoil deal	
    - Shell sold 250,000 barrels of 0.5 percent sulphur gasoil
for Jan. 11-15 lifting to Totsa at a premium of 60 cents a
barrel to Singapore quotes.	
 PRODUCT          RIC            BID     ASK     MEAN    PREV    CHG    % CHG
 Jet/Kero         JET-SIN        121.64  122.04  121.84  119.13   2.71    2.27
 Gas Oil 0.5%     GO-SIN         122.52  122.92  122.72  119.95   2.77    2.31
 Gas Oil 0.25%    GO25-SIN       123.43  123.83  123.63  120.86   2.77    2.29
 Gas Oil 0.05%    GO005-SIN      124.33  124.73  124.53  121.81   2.72    2.23
 Jet/Kero Diff    JET-SIN-DIF     -0.65   -0.45   -0.55   -0.55   0.00    0.00
 GO 0.001 Diff    GO0001-SIN-DI    2.75    2.95    2.85    2.85   0.00    0.00
                  F                                                     
 GO 0.05 Diff     GO005-SIN-DIF    2.35    2.55    2.45    2.45   0.00    0.00
 GO 0.25 Diff     GO25-SIN-DIF     1.45    1.65    1.55    1.50   0.05    3.33
 GO 0.5 Diff      GO-SIN-DIF       0.54    0.74    0.64    0.60   0.04    6.67
 GO Swap M1       GOSGSWMc1                      122.00  119.25   2.75    2.31
 GO Swap M2       GOSGSWMc2                      121.22  118.45   2.77    2.34
 	
 (Reporting by Jessica Jaganathan; editing by James Jukwey)
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