SINGAPORE: Asia's jet fuel cash premiums rose on Wednesday to the highest in nearly three weeks as seasonal refinery turnarounds in the region kept a lid on supplies.
Cash differentials for jet fuel rose to $1.17 a barrel to Singapore quotes, compared with $1.09 on Tuesday.
"There is still plenty of refinery maintenance through May to keep jet markets tight, even with demand seasonally falling to its lowest point in May," consultancy Energy Aspects said in a note.
People are anticipating the middle distillates would continue to remain relatively stronger than other refined products for the entire year, trade sources said.
Jet fuel cracks will stay strong going into the third quarter but considering a lot of refineries shut for maintenance will start coming back on stream after the second quarter, the premium levels may get a little softer, a trader said.
Asia's jet fuel margins or cracks have averaged above $15 per barrel over Dubai crude so far this year, as against an average of $12.36 a barrel in 2017.
The physical jet fuel market as per the Singapore window remained muted with no trades or offers on Wednesday.
Meanwhile, cash differentials for gasoil with 10 ppm sulphur content dipped to 48 cents a barrel to Singapore quotes from Tuesday's 55 cents, the highest so far this year.
"With crude racing higher, diesel cracks may struggle to get immediate traction despite robust fundamentals for middle distillates," according to Energy Aspects.
"Growing geopolitical risk is being priced into crude so cracks may not strengthen until stocks get uncomfortably tight."
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