SINGAPORE- Asian refining margins for jet fuel rose for a second straight session on Wednesday, thanks to a slight improvement in global aviation demand as COVID-19 vaccinations are helping more passengers to return to the skies.
Refining margins, also known as cracks, for jet fuel in Singapore inched higher by 6 cents to $6.36 per barrel over Dubai crude during Asian trading hours, their strongest since May 21.
Global scheduled flight capacity rose 6.4% this week, but they still remained 40.4% lower compared with the corresponding week in pre-pandemic 2019, according to aviation data firm OAG.
Scheduled flight seats in Japan were 10.5% higher in the week to Monday, while scheduled seats in India were up 3.2% on-week, OAG data showed.
Global capacity in May was 279.9 million seats, 4.9% higher than 266.8 million seats in April, but 43% lower than 488.2 million seats in May 2019, the data firm said.
Cash discounts for jet fuel widened 20 cents per barrel to Singapore quotes, while the June/July time spread for the aviation fuel in Singapore traded at minus 30 cents per barrel.
Meanwhile, cash differentials for 10 ppm gasoil flipped into a discount of 12 cents per barrel on Wednesday, while the prompt-month spread turned into a contango of minus 3 cents per barrel.
INVENTORIES
- Middle-distillate inventories in the Fujairah Oil Industry Zone rose 12.6% to 3.8 million barrels in the week ended May 31, data via S&P Global Platts showed.
- The weekly stocks in Fujairah have averaged 3.9 million barrels this year, compared with 4.2 million barrels in 2020, Reuters calculations showed.
TENDERS
- India's state-run refiner Indian Oil Corporation (IOC) has offered a combined cargo of light cycle oil (LCO) and high speed diesel (HSD) totalling 15,400-16,460 tonnes for loading over June 17-18 from Paradip, trade sources said.
- IOC has also offered another combined cargo of LCO and HSD totalling 32,400-35,460 tonnes for June 17-18 loading from Paradip.
- India's Nayara Energy sold 65,000-70,000 tonnes of 10-ppm gasoil for June 26-30 loading from Vadinar, a broker source said.
OTHER NEWS
- Oil rose on Wednesday, supported by an OPEC+ decision to stick to its plan to restore supply to the market gradually and by the slow pace of nuclear talks between Iran and the United States.
For a list of derivatives prices, including margins, please double click the RICs below.
(Reporting by Koustav Samanta; Editing by Subhranshu Sahu) ((koustav.samanta@thomsonreuters.com)(+65 6870 3503)(Reuters Messaging: koustav.samanta.thomsonreuters.com@reuters.net))
