SINGAPORE: Asian refining margins for jet fuel dropped on Tuesday as feedstock crude prices firmed and airlines reduced near-term capacity due to fresh waves of the COVID-19 pandemic in several markets.
Refining margins, also known as cracks, for jet fuel dropped to $4.39 per barrel over Dubai crude during Asian trading hours, the lowest since April 13. They were at $4.72 per barrel a day earlier.
Global airlines have reduced their full-month scheduled capacity for April by 3.7 million seats this week compared with last week, according to aviation data firm OAG.
The full-month capacity for May was cut by a further 15.3 million seats this week following a reduction of 13 million seats last week, while 23 million seats were also reduced from June capacity, OAG data showed.
Cash discounts for jet fuel were at 12 cents a barrel to Singapore quotes as the physical trade window in Singapore remained muted with no bids or trades on Tuesday.
Police in China’s southern Guangdong province have detained several people, including two senior staff of a BP Plc joint venture, in connection with an investigation into suspected illicit fuel trading, three people said.
The detentions come after Guangdong, China’s largest fuel consuming province, launched in February an investigation into suspected illicit trading between 2018 and 2020 of light cycle oil (LCO), a refinery by-product widely used to blend into diesel, said one of the sources.
The Guangdong police issued warrants of detention for more than 70 people in the probe, the source, who had direct knowledge of the matter, told Reuters. Under Chinese law, detention warrants allow people to be held for up to 37 days for investigations.
Two gasoil deals, no jet fuel trades. The head of global airline industry body IATA has hit out at the high cost of COVID-19 testing, accusing providers of profiteering from travel, and calling for the industry to challenge whether PCR tests are necessary.
- Oil rose to $68 a barrel and hit its highest in a month on Tuesday, supported by a disruption to Libyan exports and expectations of a drop in US crude inventories, although rising coronavirus cases in Asia limited gains.