SINGAPORE: Asia’s 10 ppm sulphur gasoil market was plagued by thin liquidity on Thursday, with mixed demand-supply outlooks among industry sources and a closed arbitrage to the West evident.

Refining margins for 10 ppm sulphur gasoil recorded slight gains of around 40 cents a barrel, with the fluctuations in the paper market equally minimal.

Cash differentials for 10 ppm sulphur gasoil firmed again for a second consecutive day, with only Trafigura seeking for spot June material, against a lack of offers.

Sellers could have retreated because of the volatile performance in oil futures these few days, one source said.

Jet fuel refining margins likewise gained to reflect the change in gasoil cracks, but overall demand is still tepid. The paper swaps market stayed in contango and open market buyers were only keen to buy cargoes at a discount to Singapore quotes.

US crude oil and distillate inventories fell unexpectedly last week as imports declined, while gasoline stockpiles dropped more than forecast, the Energy Information Administration said on Wednesday. Gasoline stocks also fell by a more than expected 2.1 million barrels in the week to 216.3 million barrels, the EIA said.

Middle distillates stockpiles at key trading hub Singapore reversed past few weeks of declines to rise in line with the slower pace of net exports for jet fuel/kerosene on week, official trade data showed on Thursday.

Oil prices fell after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting next week.

Russian Deputy Prime Minister Alexander Novak said on Thursday he expected no new steps from the OPEC+ group of oil producers at its meeting in Vienna on June 4, Russian media reported, after the group announced a significant output cut earlier this year.