April 28, 2020 / 11:07 AM / a month ago

Asia Distillates-Gasoil cracks crawl higher, traders fear prolonged supply glut

    SINGAPORE, April 28 (Reuters) - Asian refining margins for 10 ppm gasoil climbed on Tuesday
after hitting a record low in the previous session, but traders were concerned higher exports
from major markets in the near term would worsen the existing supply glut in the region.
    Refining margins or cracks for gasoil with 10 ppm sulphur content in Singapore
rose to $4.18 a barrel over Dubai crude during Asian trading hours, up from Monday's $2.83 a
barrel that was the lowest on record in Refinitiv Eikon data that goes back to January 2014.
    With weaker demand in domestic markets due to restrictions aimed at limiting the coronavirus
spread, India and China would likely pump out more barrels into the region, which is already
grappling with supplies, market watchers said.
    Cash differentials for 10 ppm gasoil GO10-SIN-DIF were at a discount of $1.99 per barrel
to Singapore quotes on Tuesday, compared with a discount of $2.13 a barrel in the previous
    The front-month time spread for 10 ppm gasoil widened its contango structure
on Tuesday to trade at a discount of $1.84 per barrel, Refinitiv Eikon data showed.
    Meanwhile, cash discounts for jet fuel JET-SIN-DIF narrowed to $4.38 a barrel to Singapore
quotes on Tuesday, compared with $4.50 a barrel on Friday.
    Cracks for jet fuel were at $3.37 a barrel below Dubai crude on Tuesday, as
against a record low of minus $4.87 per barrel on Monday.
    - Singapore's Hin Leong Trading Pte Ltd, one of Asia's top oil traders, has been placed
under the management of a court-appointed supervisor as it seeks to restructure billions of
dollars of debt, three sources with knowledge of the matter said on Monday.
    - Hin Leong had applied last week to be placed under interim judicial management and
withdrew an application it had made to the Singapore High Court for legal protection for six
months from creditors, two other sources said on Friday.
    - India's Mangalore Refinery and Petrochemicals Ltd (MRPL) has offered 65,000 tonnes of high
speed diesel (HSD) -- gasoil with 10 ppm sulphur content -- for May 21-23 loading from the port
of New Mangalore.
    - The tender closes on April 29 and has a same-day validity.
    - For more such information, click
    - No jet fuel trades, no gasoil deals
    - For more information, click
    - Oil prices slumped again on Tuesday amid concern about dwindling capacity to store crude
worldwide, heightened by fears that fuel demand may be slow to pick up once countries ease curbs
imposed on business and social life to combat the coronavirus pandemic.
    - Independent international oil producers can cope with plunging oil prices better than
higher-cost U.S. shale firms but persistent low prices may still leave them struggling to repay
debts and renew hedging facilities needed to protect revenues.
    The drop in Brent crude to $20 a barrel and less, or the even deeper slide of U.S. crude
into negative territory, has hammered U.S. shale producers, which typically need more than $40
to break even, forcing shut-ins and threatening insolvencies as the coronavirus crisis has
thumped oil demand.
 CASH ($/T)               ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%                  20.97    -1.11      -5.03       22.08  GO-SIN
 GO 0.5 Diff                        -5.02     0.47      -8.56       -5.49  GO-SIN-DIF
 Spot Gas Oil 0.25%                 21.07    -1.08      -4.88       22.15  GO25-SIN
 GO 0.25 Diff                       -4.92     0.50      -9.23       -5.42  GO25-SIN-DIF
 Spot Gas Oil 0.05%                 21.77    -0.98      -4.31       22.75  GO005-SIN
 GO 0.05 Diff                       -4.22     0.60     -12.45       -4.82  GO005-SIN-DIF
 Spot Gas Oil 0.001%                24.00    -1.44      -5.66       25.44  GO10-SIN
 GO 0.001 Diff                      -1.99     0.14      -6.57       -2.13  GO10-SIN-DIF
 Spot Jet/Kero                      14.31    -1.32      -8.45       15.63  JET-SIN
 Jet/Kero Diff                      -4.38     0.12      -2.67       -4.50  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 Rashmi Aich)
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