SINGAPORE: Margins for benchmark gasoil fell below $10 on Friday against a backdrop of rising crude prices and a weak medium-term demand outlook due to a slowdown in global economic activity, traders said.
Cracks for benchmark 500ppm gasoil have hovered around the $10 mark with weak global demand leading to an overhang of gasoil stocks.
Nevertheless, a build up in refinery turnarounds has recently helped reduce growing gasoil inventories, creating near-term support for cash differentials, traders said.
Cash discounts of 500ppm gasoil were largely unchanged on Friday, settling 2 cents down at a discount of 28 cents a barrel below Singapore quotes.
REGIONAL FLOWS:
Outflows of Indian gasoil for March have been provisionally pegged at 2.0 to 2.2 million metric tonnes, little changed from February's assessed volumes of 2.09 million tonnes, according to a Thomson Reuters Oil Research and Forecasts assessment published on Thursday.
Scheduled refinery turnarounds in Europe, the US Gulf Coast and Middle East are helping to ease some of the gasoil overhang on the continent but inventories remain high as warm weather continues to cap demand, putting pressure on margins, the assessment said.
TENDERS:
- Sri Lanka's Ceypetco may have cancelled a tender to buy 300,000 barrels of gasoil with a 0.05 percent sulphur content for April 9-10 delivery, traders said.
This could not be confirmed as Ceypetco could not be reached for comment.
Traders said Ceypetco had previously received the lowest offer from Gunvor for the tender.
- Emirates General Petroleum Corp. (Emarat) bought two cargoes of jet fuel for delivery in the first half of April at the port of Jabal Ali at a premium of $2.50 to $2.70 a barrel above Arabian Gulf quotes, sources said.
The first cargo of 30,000 tonnes is scheduled for delivery between April 1 and 2, while the second is due between April 10 and 11 and amounts to 40,000 tonnes.
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