February 8, 2019 / 11:17 AM / in 5 months

Asia Distillates-Jet fuel cash differentials gain to narrowest discount in 2-1/2 months

    SINGAPORE, Feb 8 (Reuters) - Asia's cash differentials for jet fuel firmed on Friday to
their narrowest discount in more than 11 weeks amid expectations of tighter supply as some
regional refiners are scheduled for spring maintenance outages, trade sources said.
    Jet cash discounts JET-SIN-DIF were at 19 cents a barrel to Singapore quotes on Friday,
compared with a discount of 30 cents a barrel on Thursday.
    Another factor supporting the jet fuel market is steady demand from the region's robust
aviation sector, especially on the back of the Lunar New Year holidays earlier this week that
typically boosts air travel, traders said.
    Asia-Pacific airlines' passenger traffic last year rose 7.3 percent, compared to 2017,
driven by robust regional economic expansion and increased route options for travellers, the
International Air Transport Association (IATA) said in a statement on Thursday.
    "Although this was a slowdown from the 10.5 percent year-over-year growth recorded in 2017
versus 2016, it was strong enough to lead all the regions for a second consecutive year," the
IATA said.
    Refining margins, also known as cracks, for jet fuel rose to $14.31 a barrel
over Dubai crude during Asian trade, compared with $14.04 a barrel on Thursday.
    Meanwhile, cracks for gasoil with 10ppm sulphur content climbed higher to
$14.63 a barrel over Dubai crude, from $14.37 a barrel on Thursday. Benchmark gasoil margins
have risen over 1 percent this week in a second consecutive week of gains.
    Cash discounts for 10ppm gasoil GO10-SIN-DIF were at 32 cents a barrel to Singapore quotes
on Friday, compared with Thursday's discount of 31 cents per barrel. 
    - Global air passenger traffic for 2018 showed demand increased by 6.5 percent compared to
full-year 2017, while December air traffic rose 5.3 percent year-on-year, data from the
International Air Transport Association (IATA) showed on Thursday.
    - "2018 was another year of strong passenger demand, as aviation continued to support the
global economy. We expect similar, if somewhat moderating performance in 2019," IATA Chief
Executive Alexandre de Juniac said in a statement.
    "Nevertheless, slowing growth in the second half of 2018, coupled with concerns over issues
including Brexit and U.S.-China trade tensions, are creating some uncertainty to this positive
    - India's domestic market posted the fastest full-year domestic growth rate for the fourth
straight year, with an 18.6 percent annual demand increase, supported by robust economic
expansion and increasing numbers of city pairs, IATA said.
    - Gasoil stocks independently held in the Amsterdam-Rotterdam-Antwerp (ARA) refining and
storage hub STK-GO-ARA rose just over 1 percent to about 2.4 million tonnes in the week to
Feb. 7, data from Dutch consultancy PJK International showed.
    - Gasoil inventories in ARA, which have risen steadily over the last five weeks, are
currently at their highest in three months.
    - Gasoil stocks rose as imports into the hub firmed, while cold weather kept inland demand
for heating oil buoyant, PJK's Lars van Wageningen said.
    - ARA jet fuel inventories STK-JET-ARA dropped about 2 percent to 647,000 tonnes in the
week to Thursday, PJK data showed.
    - Compared with year-ago levels, jet fuel stocks were up 5.4 percent, while gasoil
inventories were about 22 percent lower.
    - Three gasoil deals, no jet fuel trades.
    - Singapore trader Hin Leong sold 250,000 barrels of 10ppm gasoil to Vitol for Feb. 23-27
loading at a discount of 20 cents a barrel to the balance of February Singapore quotes.
    - Winson Oil sold 150,000 barrels of 10ppm gasoil to Vitol for March 5-9 loading at a
discount of 40 cents a barrel to Singapore quotes.
    - Vitol bought 150,000 barrels of 10ppm gasoil from Winson Oil for loading between Feb. 26
and March 2 at a discount of 40 cents a barrel to Singapore quotes.
    - For more information, please click   
    - Oil markets fell on Friday, pulled down by an economic slowdown, although supply cuts led
by producer club OPEC and U.S. sanctions against Venezuela provided some support.
    - Asian spot prices for liquefied natural gas (LNG) dipped to a 17-month low on subdued
trading activity in Asia-Pacific due to a week-long Chinese New Year holiday and a number of new
supply offers on the market.
    - Trading houses that resell Venezuelan crude oil have not yet found workarounds since the
United States announced sanctions to cut off socialist President Nicolas Maduro's revenue,
according to shipping data and sources. 
    - A U.S. House of Representatives committee approved a bill on Thursday that would open up
the Organization of the Petroleum Exporting Countries to antitrust lawsuits, but it was
uncertain if the measure would be considered by the full chamber.

 CASH ($/T)             ASIA CLOSE         Change   % Change    Prev Close  RIC
 Spot Gas Oil 0.5%                  72.55    -0.63       -0.86       73.18  GO-SIN
 GO 0.5 Diff                        -2.99     0.01       -0.33       -3.00  GO-SIN-DIF
 Spot Gas Oil 0.25%                 73.09    -0.64       -0.87       73.73  GO25-SIN
 GO 0.25 Diff                       -2.45     0.00        0.00       -2.45  GO25-SIN-DIF
 Spot Gas Oil 0.05%                 73.64    -0.54       -0.73       74.18  GO005-SIN
 GO 0.05 Diff                       -1.90     0.10       -5.00       -2.00  GO005-SIN-DIF
 Spot Gas Oil 0.001%                75.22    -0.65       -0.86       75.87  GO10-SIN
 GO 0.001 Diff                      -0.32    -0.01        3.23       -0.31  GO10-SIN-DIF
 Spot Jet/Kero                      74.99    -0.59       -0.78       75.58  JET-SIN
 Jet/Kero Diff                      -0.19     0.11      -36.67       -0.30  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 David Evans)
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