SINGAPORE: Asian jet fuel prices weakened on Monday, making it slightly profitable to send the product from Asia to Europe and US West Coast, traders said on Monday.
The jet fuel crack for May fell 33 cents to $16.72 a barrel above Dubai crude, while the balance April/May timespread remained steady at minus 11 cents a barrel, Reuters data showed.
While no shipping fixtures were seen recently, the arbitrage is slightly workable to send jet fuel from Japan to US West coast, one of the traders said. It could also work from South Korea to Europe, though marginally, a second trader said.
Diesel arbitrage, on the other hand, looks unworkable for the product to be sent from Asia to Europe as fundamentals for the product are still strong in Asia, traders said.
Sri Lanka's Lanka IOC emerged in the spot market to seek more than 70,000 tonnes of gasoil and gasoline for delivery in May, after skipping imports for April.
Indian Oil Corp bought 60,000 tonnes of 320 ppm sulphur diesel from BP at a premium of above $6 a barrel to Middle East quotes, industry sources said.
This is slightly weaker than the $6.50 a barrel premium IOC paid for a February-delivery cargo, they added.
China Aviation Oil has bought up to 1.4 million barrels of jet fuel for loading from North Asia at a discount of 30 cents a barrel to Singapore quotes, traders said.
The sellers are not known, but levels done are weaker than previous cargoes bought by the company, they added.
In the Middle East, premiums for the medium sulphur gasoil continued to hold steady with Bahrain Petroleum Co (Bapco) selling up to 40,000 tonnes for loading over April 10-17 at $4.50 a barrel over Middle East quotes.
Tanzania has bought more than 400,000 tonnes of 500 ppm sulphur gasoil from Swiss-based Augusta Energy at a premium of about $54 a tonne over Middle East quotes, which is also keeping Middle East gasoil well supported, traders said.
Bapco was also seeking about $2 a barrel for an April 16-17 loading jet fuel cargo, though the best bid was at $1.70 a barrel over Middle East quotes, traders said. It is unclear if the cargo has been awarded.
Tasweeq was heard to have cancelled a tender offering 40,000 tonnes of 0.2 percent sulphur gasoil for loading over May 9-10, but this could not be confirmed.
TENDERS: Lanka IOC is seeking a combination cargo of 19,000 tonnes of 0.25 percent sulphur gasoil and 11,000 tonnes of 90-octane gasoline for delivery into Trincomalee over May 2-4. It is also seeking a combination cargo of 18,000 tonnes of 0.25 percent sulphur gasoil, 5,000 tonnes of 0.5 percent sulphur gasoil, 3,000 tonnes of 500 ppm sulphur diesel and 15,000 tonnes of 90-octane gasoline for delivery to Colombo over May 9-11. The tender closes on April 4 and is valid until April 5.