Asian gas, oil, diesel firmer in quiet market, say traders
Asian gas, oil, diesel firmer in quiet market, say traders
SINGAPORE (Reuter): Singapore middle distillates prices rose on firmer crude values yesterday and expectations of stronger regional demand which could absorb the persistent oversupplies, traders said.
They said Indonesia could be a big buyer in August -- projected at around six million barrels -- higher than their July purchases of about five million.
Indonesia normally imports around four million barrels a month, traders said.
The additional demand in August was attributed to a scheduled shutdown at a 200,000-barrel-per-day (bpd) crude unit for a month from July 10 and a 100,000-bpd unit from August 13 for about 35 days.
Industry sources said the shutdowns were expected to start as scheduled, and even if there were to be a delay it would only be for a few days.
Indonesia was also heard to have bought a July lifting gas oil parcel at a steep discount of 90 cents per barrel to Singapore spot quotes, free-on-board (fob) basis. But traders noted that the cargo was only 10,000 tons and did not reflect current market levels.
They said the level for end-July barrels should be around a 20-cent discount, fob while prompt barrels would be between 50 and 70 cents discounts.
Traders said a US major late last week sold 100,000 barrels of gas oil to a trader at a 10-cent discount for July 21-25 lifting fob.
Sellers dominated the physical gas oil market with three sellers offering at firm levels of $22.40 per barrel for July 15- 19 lifting fob, facing no buyers.
A 150,000 barrel parcel was also offered at $165 per ton, fob basis ($22.15 per barrel) for the same timing.
On Friday, a deal was done for the same period at $21.70 per barrel, fob Singapore, which was 70 cents below Thursday's lowest offer.
Traders however noted that India would not contribute to the current stronger sentiment on the spot market, as state-owned Indian Oil Corp (IOC) were expected to limit its August purchases to less than 400,000 tons.
They said this could be because IOC had taken large volumes in July amounting to 855,000 tons, while the current low prices could prompt India to take more cargoes in its term tender.