RTRS:Asia Distillates-Gas oil's Sep/Oct surges to 5-month high
SINGAPORE, Sept 14 (Reuters) - Asia's gas oil market strengthened on
Wednesday, with the prompt timespread hitting a five-month high, as sentiment
received a boost after Singapore trader Hin Leong continued its buying spree in
the physical spot market at higher prices.
The September/October contract was valued at a backwardation of 50 cents a
barrel by 0830 GMT, up 20 cents from a day earlier, Reuters data showed. The
October/November timespread, which becomes the front-month contract on Friday,
was up 3 cents to a contango of 1 cent a barrel.
Hin Leong snapped up all four 0.5 percent sulphur gas oil cargoes concluded
during the pricing window, totalling 630,000 barrels, at a premium of 10-30
cents a barrel, up from parity a day earlier.
"Hin Leong has pushed the diff all the way this month, the question is where
are all the cargoes headed. It could feed some of the Indonesian demand we are
seeing," said a Singapore-based distillates trader.
The purchases helped push the benchmark grade's cash differential into
positive territory and its highest level in over four months. Hin Leong has
accumulated over 2 million barrels since the start of the month.
The October crack was also higher, rebounding by 18 cents to $16.52 after
losing almost a dollar a day earlier.
Gains were capped by data showing Japanese gas oil exports more than doubled
to over 300,000 barrels per day in the week ended Sep 10.
In the swaps market, at least 150,000 barrels of the gas oil September swap
were done at $122.10-$122.20 a barrel, down from 450,000 barrels a day earlier.
Another 200,000 barrels of the September/October timespread changed hands at 45
cents a barrel.
There was heavy captivity in the regrade, with 300,000 barrels of the
October contract transacted at $1.80-$1.85, and 50,000 barrels of the September
spread done at $1 a barrel.
* SWAPS OUTRIGHTS: Gas oil's September swap fell 30 cents to $122.20 a
barrel, while the October swap lost 50 cents to $121.70 a barrel.
- Jet fuel swaps for September shed 30 cents to $123.10, while the September
regrade, or the difference between jet and diesel prices, was steady at 90 cents
for a third session.
* CRACKS: Gas oil's crack for October added 18 cents to $16.52 a barrel over
Dubai crude.
- Jet fuel's October crack climbed 28 cents to $18.27 a barrel.
* CASH DIFFERENTIALS: The differential for gas oil with 0.5 percent sulphur
rose 25 cents to a premium of 25 cents a barrel, while the premium for the 0.25
percent sulphur grade gained 20 cents to $1.00. The 0.05 percent sulphur grade
was 15 cents higher at a premium of $2.10.
- Jet fuel's cash discount added 5 cents to 50 cents.
* PHYSICAL OUTRIGHTS: Benchmark diesel with a maximum sulphur content of 0.5
percent was 10 cents lower at $122.25 a barrel, while jet fuel rose 10 cents to
$122.85.
* CASH DEALS: Four 0.5 percent sulphur gas oil deals, no jet fuel trades.
- Hin Leong bought two 150,000-barrel cargoes from Brightoil for Sep 29-Oct
3 and Oct 9-13 lifting at a premium of 10 cents and 20 cents respectively.
- The Singapore trader bought another two cargoes totalling 330,000 barrels
from Shell for Sep 29-Oct 3 and Oct 8-12 lifting at a premium of 30 cents and 20
cents, respectively.
