BENGALURU: Asian refining margins for jet fuel inched higher on Tuesday after falling to the lowest in more than two months in the previous session, while cash differentials remained at a discount for the second consecutive day.
The Singapore profit margin for jet was at $15 a barrel over Dubai crude during Asian trading hours, up from $14.74 on Monday.
Cash differentials were at a discount of 3 cents a barrel to Singapore quotes, narrowing from a discount of 20 cents a barrel on Monday.
Meanwhile, cash premiums for gasoil with 10 ppm sulphur content rose to 29 cents a barrel to Singapore quotes on Tuesday, up from 20 cents on Monday.
"We think the strength in gasoil is driving the (middle distillates) market rather than the weakness in jet," said Rachel Yew, Singapore-based analyst at energy consultancy FGE.
"The strength we are currently seeing in gasoil is due to a combination of factors, such as heavy refinery maintenance, low Chinese exports, as well as global inventories that are at a multi-year low."
The market, however, will come under pressure around the third quarter of this year as refineries shut for seasonal turnarounds return from maintenance and push up supplies, market watchers said.
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