SINGAPORE, July 9 (Reuters) - Asia's cash premiums for 10 ppm gasoil inched up on Thursday, thanks to a firmer deal in the physical market, while refining profit margins for the industrial fuel edged higher. Traders, however, remained worried that recovery in gasoil demand would likely come under pressure due to renewed lockdowns as many countries face a resurgence in COVID-19 cases. Cash premiums for 10-ppm gasoilwere at 58 cents a barrel to Singapore quotes on Thursday, two cents higher than Wednesday. The prompt-month time spread for 10 ppm gasoil traded at a premium of 41 cents a barrel on Thursday, compared with 67 cents per barrel a week earlier. In backwardation, the prompt-month contract is more expensive than subsequent months, which makes it uneconomical to store the product and leads to a drawdown in inventories. But a narrowing backwardation indicates the market may flip back into contango -- the opposite of backwardation -- that tends to encourage holders of physical barrels to store the product for selling later to secure higher prices. The region has ample gasoil supplies at the moment, while more supplies are expected in the next few weeks as regional refiners have been ramping up output, traders said. Gasoil demand typically takes a beating during the third quarter as monsoon season dampens agricultural demand, while heavy rainfall impacts transportation demand in some parts of the region, they added. Refining margins for gasoil with 10-ppm sulphur content rose by 6 cents to $6.54 a barrel over Dubai crude during Asian trading hours. INVENTORIES - Singapore onshore middle distillate stocks rose 1.5% to 13.6 million barrels in the week ended July 8, Enterprise Singapore data showed. - The weekly Singapore middle distillate inventories have averaged at 12.8 million barrels so far in 2020, Reuters calculations showed. This week's stocks were 23% higher year-on-year. - U.S. distillate stockpiles rose 3.1 million barrels to about 177.3 million barrels, their highest level since 1983, the Energy Information Administration said on Wednesday. SINGAPORE CASH DEALS - One gasoil deal, no jet fuel trades OTHER NEWS - Oil prices edged lower on Thursday as concerns about renewed COVID-19 lockdowns in the United States outweighed signs of a recovery in U.S. gasoline demand. ASSESSMENTS MID-DISTILLATES CASH ($/T) ASIA CLOSE Change % Change Prev Close RIC Spot Gas Oil 0.5% 48.61 0.44 0.91 48.17 GO 0.5 Diff -0.86 0.01 -1.15 -0.87 Spot Gas Oil 0.25% 49.25 0.44 0.90 48.81 GO 0.25 Diff -0.22 0.01 -4.35 -0.23 Spot Gas Oil 0.05% 49.94 0.44 0.89 49.50 GO 0.05 Diff 0.47 0.01 2.17 0.46 Spot Gas Oil 0.001% 50.05 0.45 0.91 49.60 GO 0.001 Diff 0.58 0.02 3.57 0.56 Spot Jet/Kero 43.33 0.27 0.63 43.06 Jet/Kero Diff -0.34 0.03 -8.11 -0.37 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 Krishna Chandra Eluri)
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