Asia’s diesel markets on Friday continued on their general upward trajectory despite some shakiness mid-week, as traders continue to price in robust front-month supply-demand fundamentals, while jet cash premiums gained to two-year highs.

Deals for some northeast Asian cargoes were at premiums of $1.50-1.90 per barrel for first-half December shipments, traders say, as some buyers continue to cover their requirements amid tightened supply availability.

A slew of refinery troubles continued to plague the market, contributing to supply limitations.

Term discussions were also proceeding, with talks of slightly higher premiums from last year.

Refining margins (GO10SGCKMc1) softened from the previous session and were lower slightly week on week to around $27 a barrel.

Cash differentials (GO10-SIN-DIF) eased further, softening to $2.7 a barrel, reflecting the narrower paper market backwardation – though a lack of lower-priced offers capped weakness.

Jet fuel markets turned bullish towards late week, slightly outperforming gasoil as evidenced from the narrower regrade, as fundamentals were still firm.

Exports to the United States are still remaining firm in November, likewise October, several traders say, as the market there is still showing some shortages from refinery production woes.

Spot premiums for the aviation fuel (JET-SIN-DIF) soared to two-year highs after going on an upward trajectory since early October.

Regrade (JETREG10SGMc1) surged back to premiums of 10-20 cents per barrel, reflecting firmer jet fuel trading sentiment.

SINGAPORE CASH DEALS

– No deals for gasoil or jet fuel

INVENTORIES

– U.S. crude stocks rose while gasoline and distillate inventories fell last week on stronger demand, the Energy Information Administration said on Thursday.
– Gasoline stocks independently held in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub fell by 7.4% on the week, data from Dutch consultancy Insights Global showed on Thursday.

NEWS

– Oil prices jumped about 2% on Friday on supply fears after a Ukrainian drone attack hit an oil depot in the Russian Black Sea port of Novorossiysk, a major export hub.
– China’s crude oil throughput in October rose 6.4% year-on-year as refiners ramped up throughput on improving margins.
– Russia’s oil processing has fallen just 3% this year despite Ukraine’s biggest drone attacks to date as refineries averted a steep decline in fuel production by leveraging spare capacity to offset damage from the strikes, sources said and data showed.
– U.S. private equity giant Carlyle is exploring options to buy Russian oil major Lukoil’s foreign assets, three sources familiar with the situation said.
Source: Reuters