June 11, 2020 / 10:51 AM / 21 days ago

Asia Distillates-Gasoil cash premiums climb to near 4-month peak

    SINGAPORE, June 11 (Reuters) - Asia's cash premiums for 10 ppm gasoil rose to their highest
in nearly four months on Thursday, helped by a steady buying interest for physical cargoes as
countries in the region increasingly ease coronavirus restrictions.
    Cash differentials for 10 ppm gasoil GO10-SIN-DIF were at a premium of 59 cents a barrel
to Singapore quotes, the highest since Feb. 13. 
    The gasoil market has tightened partly due to ongoing refinery run cuts and turnarounds in
the region, while traders expect demand to rise in the coming weeks as industrial activity picks
up after lockdowns are eased.
    Limited scope for arbitrage opportunities, however, would keep a lid on a fast recovery for
gasoil, market watchers said.
    The exchange of futures for swaps (EFS), which determines the gasoil price spread between
Singapore and Northwest Europe, traded at minus 30 cents per tonne on Thursday,
Refinitiv Eikon data showed. This typically makes the arbitrage shipments unworkable.
    Arbitrage is usually profitable when the EFS trade at about minus $15 a tonne or below,
though it depends on other factors including freight rates as well, traders said.
    Refining margins or cracks for gasoil with 10 ppm sulphur content dropped to
$6.26 a barrel over Dubai crude during Asian trade on Thursday, down from $6.60 per barrel a day
    - Singapore onshore middle distillate stocks rose 1.5% to a two-week high of 14.9 million
barrels in the week ended June 10, Enterprise Singapore data showed.
    - The weekly Singapore middle distillate inventories have averaged at 12.6 million barrels
so far in 2020, Reuters calculations showed. This week's stocks were 41.1% higher year-on-year.
    - U.S. distillate stockpiles rose 1.6 million barrels to 175.8 million barrels in the week
to June 5, compared with expectations for a 3 million-barrel rise, the Energy Information
Administration said on Wednesday.

    - No jet fuel trade, no gasoil deal
    - Oil prices fell by about 4% on Thursday on worries about slow demand growth as coronavirus
cases rise, with U.S. crude stockpiles hitting an all-time high and the U.S. Federal Reserve
saying recovery from the pandemic could take years.
 CASH ($/T)            ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%               44.90     0.02       0.04       44.88  GO-SIN
 GO 0.5 Diff                     -1.53     0.42     -21.54       -1.95  GO-SIN-DIF
 Spot Gas Oil 0.25%              45.68    -0.10      -0.22       45.78  GO25-SIN
 GO 0.25 Diff                    -0.75     0.30     -28.57       -1.05  GO25-SIN-DIF
 Spot Gas Oil 0.05%              46.37    -0.34      -0.73       46.71  GO005-SIN
 GO 0.05 Diff                    -0.06     0.06     -50.00       -0.12  GO005-SIN-DIF
 Spot Gas Oil 0.001%             47.02    -0.29      -0.61       47.31  GO10-SIN
 GO 0.001 Diff                    0.59     0.11      22.92        0.48  GO10-SIN-DIF
 Spot Jet/Kero                   41.84    -0.69      -1.62       42.53  JET-SIN
 Jet/Kero Diff                   -0.52    -0.11      26.83       -0.41  JET-SIN-DIF
 For a list of derivatives prices, including margins, please double                    
 click the RICs below.                                                  
 Brent M1                                                                              
 Gasoil M1                                                                             
 Gasoil M1/M2                                                                          
 Gasoil M2                                                                             
 Regrade M1                                                                            
 Regrade M2                                                                            
 Jet M1                                                                                
 Jet M1/M2                                                                             
 Jet M2                                                                                
 Gasoil 500ppm-Dubai                                                                   
 Cracks M1                                                              
 Gasoil 500ppm-Dubai                                                                   
 Cracks M2                                                              
 Jet Cracks M1                                                                         
 Jet Cracks M2                                                                         
 East-West M1                                                                          
 East-West M2                                                                          
 LGO M1                                                                                
 LGO M1/M2                                                                             
 LGO M2                                                                                
 Crack LGO-Brent M1                                                                    
 Crack LGO-Brent M2                                                                    
 (Reporting by Koustav Samanta;
Editing by Vinay Dwivedi)
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