SINGAPORE: Asia’s naphtha and gasoline cracks slipped on Thursday as concerns about rising COVID-19 cases in parts of Asia weighed on fuel demand outlook.

India, the world’s third-largest oil user, reported on Thursday 314,835 new cases of the coronavirus over the previous 24 hours, the highest daily increase recorded anywhere. Japan, the world’s No.4 oil importer, is expected to issue a third state of emergency on Tokyo and three western prefectures that could last for about two weeks, according to media reports.

Traders are watching out for signs of reduced fuel demand in India and refiners to adjust output. One trader expects fuel exports from private refiners Reliance Industries and Nayara to hold steady in May while another said India’s naphtha exports could fall.

Lower exports from India could be supportive to light distillates markets.

Meanwhile, South Korea’s Hanwha Total, GS Caltex and KPIC have issued tenders seeking naphtha supplies for first-half June delivery, a trader said, which could provide price direction.

The tenders come after Taiwan’s Formosa Petrochemical sought cheaper liquefied petroleum gas to replace naphtha as feedstock.

Gasoline crack slipped for a fourth session to the lowest in nearly a week after US gasoline stocks rose slightly last week. This was despite a drop in Singapore stocks to the lowest in four months.

Singapore’s light distillates stocks fell 1.268 million barrels to a four-month low of 13.472 million barrels in the week to April 21, Enterprise Singapore data showed on Thursday.

US gasoline stocks rose by 86,000 barrels last week to 235 million barrels, the Energy Information Administration said, compared with analysts’ expectations for a 464,000 million-barrel rise.