Asia’s naphtha markets went into a steeper backwardated structure as front months remained propped up by limited supply concerns, while some regional spot buying for second-half November cargoes were underway.

Refining margins for the petchem feedstock (NAF-SIN-CRK) gained slightly to nearly $99.50 per metric ton, while the timespreads further widened between first-half and second-half December.

For physical cargoes, deals and discussions in northeast Asia were at high single digit premiums, while some deals in southeast Asia were done in double digit premiums.

More buying for second-half November arrivals should resurface in the next week, with at least two regional northeast importers still yet to confirm their requirements.

Supplies from regions such as Russia and the Middle East are likely to remain curtailed until year-end, mostly due to refinery maintenance especially in the Middle East.

However, concerns on how sustainable demand, given shaky production spreads on the petrochemical front, capped overall market firmness.

Gasoline cracks (GL92-SIN-CRK) eased slightly to around $10.2 a barrel amid some window selling interest, though markets remain buoyed by supply disruption worries globally and expectations of some sporadic demand emerging regionally.

China-origin exports are expected to average 600,000 tons for October, little changed from earlier September forecasts.

INVENTORIES

– U.S. crude oil, gasoline and distillate inventories rose last week as refining activity and demand softened, the Energy Information Administration said on Wednesday.

NEWS

– Russian oil product exports from the Black Sea port of Tuapse are set to fall to 0.888 million metric tons in October, down 21.7% on a daily basis from 1.098 million metric tons scheduled for September, two traders said on Wednesday
– European oil refineries are having to invest in energy transition projects as modern and more complex competitors in Asia, the Middle East and Africa have prompted plant closures in Europe, refining industry executives said on Wednesday.
– U.S. oil refiner Phillips 66 expects to book about $100 million of charges to idle its 139,000-barrel-per-day Los Angeles-area refinery, which will cease operations by year-end, the company said on Wednesday.
– The Group of Seven nations’ finance ministers said on Wednesday they will take joint steps to increase pressure on Russia by targeting those who are continuing to increase their purchases of Russian oil and those that are facilitating circumvention.
– Venezuela’s oil exports averaged 1.09 million barrels per day (bpd) in September, the highest monthly level since February 2020, according to shipping data and documents from state-run energy company PDVSA.

SINGAPORE CASH DEALS

– One gasoline deal, one naphtha deal
Source: Reuters