Asia’s middle distillates market activity gained slight momentum and front-month derivative prices held strong, though window deals were scant and traders were still eyeing August spot offers.

August discussions had yet to start, but multiple traders were expecting supply volumes to be little changed compared with July, given higher average crude runs in the region after the refinery maintenance season.

Meanwhile, some July spot sales by China’s refiners were earlier done at discounts of nearly $1 a barrel, two regional trade sources said.

There is still some positive expectation in the market for July that swing barrels can still pivot west, which could limit the regional supply glut, a third trade source said.

On the trading window, strong buying interest was prevalent but offers were scant.

The 10ppm sulphur cash differentials moved in tandem with the stronger market structure, given the buy-sell gap.

Refining margins gained slightly to around $18.9 a barrel, reflecting gains in the paper markets.

Meanwhile, front-month regrade discounts turned smaller after a rollover in assessment months.

SINGAPORE CASH DEALS

– No deals for both fuels

INVENTORIES

– U.S. crude oil and distillate stockpiles were expected to have fallen last week, while gasoline supplies likely rose, a preliminary Reuters poll showed on Monday.

NEWS

– Saudi Arabia, the world’s biggest oil exporter, may raise its August crude oil prices for buyers in Asia to the highest in four months, after spot prices surged during the Iran-Israel conflict and on robust summer fuel demand, trade sources said.

– Britain’s Lindsey oil refinery has begun insolvency proceedings, putting hundreds of jobs at risk and potentially increasing the country’s reliance on fuel imports just weeks after its Grangemouth refinery stopped processing oil.

– Chevron CVX.N will close its Aberdeen, Scotland, office, the U.S. oil producer said on Monday, ending the company’s decades-long presence in the city as part of its ongoing restructuring.

– Oil prices steadied on Tuesday after sliding earlier in the session, with the market weighing expectations of an OPEC+ output hike in August in an upcoming meeting.
Source: Reuters