Asia’s 10-ppm sulphur gasoil and jet fuel margins posted gains for the second consecutive year helped by strong market fundamentals, with limited supply from China before fresh export quotas were released in September.
Refining margins (GO10SGCKMc1) closed 53 cents higher at $37.99 a barrel on Friday, while jet fuel refining margins (JETSGCKMc1) rose in tandem to end the session at $37.89 a barrel.
Gasoil margins have increased 1.4% and jet fuel margins have risen by nearly four-fold this year from 2021.
Margins for both jet fuel and 10-ppm sulphur gasoil rose to their highest level for the year around mid-June, bolstered by strong demand-supply fundamentals amid air travel recovery and tighter supplies then.
The sentiment was also weighed on by rising stock levels in the West, with talks among industry sources of large Russian volumes heading into northwest Europe in January-February next year.
Cash differentials (GO10-SIN-DIF) for 10 ppm sulphur gasoil were little changed day-on-day at $1.78 a barrel on Friday.
Regrade (JETREG10SGMc1) closed the year at the narrowest level of minus 10 cents per barrel on the back of stronger kerosene demand, after hovering between minus $5 per barrel and $10 per barrel throughout 2022.
SINGAPORE CASH DEALS
– No gasoil or jet fuel deal.
INVENTORIES
– U.S. crude oil inventories rose unexpectedly by 718,000 barrels in the week ended Dec. 23 to 419 million barrels as imports climbed and exports fell, the Energy Information Administration (EIA) said on Thursday. Distillate stockpiles (USOILD=ECI), which include diesel and heating oil, rose by 300,000 barrels in the week to 120.2 million barrels, versus expectations for a 2 million-barrel drop, the EIA data showed.
– Gasoil stocks held in independent storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage area hit a fresh 13-month high in the week to Thursday, data from Dutch consultancy Insights Global showed. Delays in ports for discharging ships are widespread in the region, with shipping activity unusually busy, Insights Global’s Lars van Wageningen said.
NEWS
– Oil prices edged up on Friday and were on track to post a second straight annual gain, albeit a meagre one, in a year marked by tight supplies due to the Ukraine conflict, a strong dollar and weak demand from the world’s top crude importer China.
