Asia’s gasoline markets softened further on Wednesday despite slightly more upbeat spot activity on the trading window, as cautious supply outlooks stayed in focus.

The octane-92 refining margins fell for a third session (GL92-SIN-CRK) to $14.2 a barrel.

Meanwhile, January-February backwardation in paper markets narrowed to below 90 cents per barrel at the market’s close, according to some trade sources.

Concerns of rising supplies heading into January along with talks of arbitrage cargoes loading this month are expected to put downside pressure on the market in the near term.

Meanwhile, for naphtha, spot deals on the trading window were scant for a third straight session this week.

Regional end-user buying interest is slowing slightly amid cautious expectations of upstream crude prices, against a backdrop of limited movement in the derivative petrochemical markets.

Naphtha refining margins (NAF-SIN-CRK) fell to around $90.6 per ton at the market’s close.

NEWS

– Shell has restarted efforts to sell its stake in Germany’s PCK Schwedt oil refinery, three sources familiar with the matter told Reuters, aiming to exit an asset entangled in Western sanctions on Russia and Berlin’s need to secure fuel supplies.
– U.S. President Donald Trump ordered on Tuesday a “blockade” of all sanctioned oil tankers entering and leaving Venezuela, in Washington’s latest move to increase pressure on Nicolas Maduro’s government, targeting its main source of income.
– Saudi Arabia’s Midad Energy has emerged as one of the leading contenders to buy Russian oil major Lukoil’s international assets, leveraging deep political ties with Moscow and Washington, three people familiar with the matter said.
– State-owned Uganda National Oil Company plans to borrow $2 billion from a unit of global commodities trader Vitol to fund construction of infrastructure projects, including a crude refinery, according to a finance ministry official.

INVENTORIES

– U.S. crude stocks fell, while fuel inventories rose last week, market sources said, citing American Petroleum Institute figures on Tuesday.
– Light distillates stocks held at Fujairah Oil Industry Zone were at three week lows of 6.89 million barrels in the week of December 15, , according to industry information service S&P Global Commodity Insights.

SINGAPORE CASH DEALS
– Two gasoline deals, no naphtha deal
Source: Reuters