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Energy

Asia Distillates-Jet cracks fall; 'travel bubbles' not enough say traders

    SINGAPORE, Sept 3 (Reuters) - Asian refining margins weakened on Thursday, lingering close
to multi-month lows, as most of coronavirus-led border restrictions still remain in place and
traders believe 'travel bubbles' will not be sufficient to help uplift the aviation sector in
the near-term.
    Refining margins or cracks for jet fuel were at a discount of $1.55 a barrel to
Dubai crude during Asian trading hours, compared with minus $1.21 a barrel on Wednesday.
    "Unless demand stages an impressive recovery, and the prospect of travel bubbles is likely
to only see a limited support, we do not see much upside to cracks," said Philip Jones-Lux,
energy market analyst at consultancy JBC Energy.
    Several countries are planning for 'travel bubble' agreements with select counterparties to
boost the aviation sector as persistent coronavirus cases have rattled the region's airlines and
its tourism industry.
    But the prospect of these travel agreements between countries would likely not be enough to
boost the aviation fuel market that has been the hardest hit from the pandemic among oil
products, trade sources said.
    "I don't think travel bubbles would make a huge or any meaningful impact in the short term,"
a Singapore-based trader said.
    Cash discounts for jet fuel JET-SIN-DIF remained unchanged at $1.22 a barrel to Singapore
quotes on Thursday.

    INVENTORIES
    - Singapore's middle distillate inventories jumped 11.6% to their highest in more than nine
years in the week to Sept. 2 as net import volumes surged from the previous week, official data
showed on Thursday.
    - Onshore middle distillate stocks rose 1.662 million barrels to 16.024 million barrels,
according to Enterprise Singapore data.
    - Weekly Singapore middle distillate inventories have averaged about 13.1 million barrels so
far in 2020, Reuters calculations showed. This week's stocks were 46.6% higher year on year.
    - U.S. distillate stockpiles fell by 1.7 million barrels in the week, compared with
expectations of a 1.4 million-barrel drop, U.S. Energy Information Administration data showed on
Wednesday.
    
    SINGAPORE CASH DEALS
    - Two gasoil deals, no jet fuel trades
    
    OTHER NEWS
    - Vietnam plans to restart international commercial flights to and from six Asian cities
from mid-September, state media reported on Thursday, ending months of coronavirus-related
suspension after easing some restrictions on foreign business travellers.
    
    ASSESSMENTS
 MID-DISTILLATES                                                                       
 CASH ($/T)            ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%               44.32    -2.73      -5.80       47.05  GO-SIN
 GO 0.5 Diff                     -2.38    -0.05       2.15       -2.33  GO-SIN-DIF
 Spot Gas Oil 0.25%              44.52    -2.73      -5.78       47.25  GO25-SIN
 GO 0.25 Diff                    -2.18    -0.05       2.35       -2.13  GO25-SIN-DIF
 Spot Gas Oil 0.05%              44.72    -2.73      -5.75       47.45  GO005-SIN
 GO 0.05 Diff                    -1.98    -0.05       2.59       -1.93  GO005-SIN-DIF
 Spot Gas Oil 0.001%             46.04    -2.74      -5.62       48.78  GO10-SIN
 GO 0.001 Diff                   -0.66    -0.06      10.00       -0.60  GO10-SIN-DIF
 Spot Jet/Kero                   40.05    -2.26      -5.34       42.31  JET-SIN
 Jet/Kero Diff                   -1.22     0.00       0.00       -1.22  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 Krishna Chandra Eluri)
  
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