SINGAPORE: Asia’s gasoline crack inched up on Tuesday, but still lingered close to its weakest level in a month, amid concerns for near-term demand as coronavirus lockdowns in several markets limit the usage of the transportation fuel.
The gasoline crack edged higher to $5.89 per barrel on Tuesday, 3 cents up from a one month-low touched in the previous session.
Surging COVID-19 cases in India, the world’s third-biggest oil consumer, is fuelling concerns over fuel demand recovery as lockdowns and curfews in many states are rattling domestic consumption.
“We expect reduction in road traffic in many states, especially in Maharashtra, where we estimate gasoline demand in April will decline by 20% compared to pre-pandemic level,” said Qiaoling Chen, research analyst at consultancy Wood Mackenzie.
Asia’s naphtha crack climbed to $88 per tonne on Tuesday, the strongest since April 16. The naphtha crack was at $80.53 per tonne on Monday.
Motorists taking weekend trips have helped boost gasoline demand in the United States, China and the United Kingdom, but the recovery has been crimped by rising coronavirus infection rates elsewhere, particularly India.
Many people globally are still working from home, but weekend driving patterns show motorists are leaving the house more frequently, with weekend congestion in numerous cities surpassing 2019 levels for the first time since the pandemic started.
KPC has closed a tender offering 50,000 tonnes of full-range naphtha cargo, loading over May 7-8, trade sources said. The tender was concluded with a Japanese end-user at a premium of around $25 per tonne over Arab Gulf quotes. Japan’s Maruzen Petrochemical has bought a H1 June naphtha cargo at a premium of around $10-11 over Japan CFR quotes, a trader said.
The OPEC+ joint technical committee (JTC) has kept its forecast for growth in global oil demand this year, but is concerned about surging COVID-19 cases in India and elsewhere, three sources from the producer group told Reuters.
Australian fuel supplier Viva Energy Group said it expected to receive government aid of about A$19.6 million ($15.28 million) for the first quarter to keep its Geelong refinery running.
Copyright Business Recorder, 2021
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