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Weekly Summary

Products: Sep 6-10: H2 Oct prices of naphtha risen on material demand

GASOLINE

The differential for MR-size cargoes of 92RON gasoline on an FOB Northeast Asia basis was unchanged. Refiners in Northeast Asia gradually started sales of cargoes loading in October. On Sep 9, Formosa Petrochemicals Co in Taiwan issued a sell tender for 250,000bbl of 93RON gasoline loading on Oct 27-31. In Vietnam, Nghi Son Refinery and Petrochemicals Ltd also issued a sell tender for one or two 30,000mt cargoes of 95RON gasoline loading on Sep 15-30. The tender was scheduled to close on Sep 13. Vietnam is usually in an import position of gasoline. However, amid the outbreak of COVID-19, the seller seemed to be making moves to sell excess volumes at home. Some pointed out that lockdown in some areas in the country was likely to be lifted in mid-September.

 

NAPHTHA

In the Northeast Asia market, deal levels for second-half October arrival moved up, and the market values were advancing. In the region, ethylene prices were keeping higher on the back of steady demand for ethylene derivatives, and the crack margins against naphtha were widening to a little less than $400/mt. Demand for naphtha as feedstock of ethylene would likely extend especially that of high paraffinic grade. At the same time, sentiment for the FOB Middle East prices was also firm. Qatar Petroleum (QP) had concluded a sell term contract starting from October to December at a premium of $25-28/mt to Middle East quotations on an FOB basis depending on grades with a part of traders.

 

MIDDLE DISTILLATES

The differentials for MR-size cargoes of 0.001% sulfur gasoil on an FOB Northeast Asia basis leveled off. However, market sentiment was strong as demand for cargoes for Europe was increasing. In Europe, demand of oil products including gasoil was strengthening as vaccinations for COVID-19 were prevailing and economical activities were recovering. In Asia, some traders were procuring volumes with large vessels, so that a sense of oversupply in Asia was being eased. Meanwhile, it was rumored that a cargo from Japan loading in October may have been traded at a discount of 65-70cts/bbl to Singapore quotations on an FOB basis, but details were unknown. In South Korea, SK Energy closed a sell tender for three MR-size cargoes loading on Oct 5-7, 15-17 and 23-25 on Thursday. In addition, Nghi Son Refinery and Petrochemicals Ltd in Vietnam issued a sell tender for one or two 25,000mt cargoes loading on Sep 15-30. The tender was scheduled to close on Sep 13.

 

FUEL OIL

The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis held steady. Hyundai Oilbank had shut down one residue desulfurization unit (RDS) at its 690,000bbl/d Daesan refinery for turnaround from September. The company was scheduling to have turnaround of another RDS from mid-October. Although productions of VLSFO would possibly decline for some regular maintenance, the company maintained the refinery run rates at higher than 90% as there was only little impact of turnaround expected. Also, while SK Energy was planning turnaround of one RDS from mid-October, the supply volumes of VLSFO in October were expected to increase compared to September.

  

 

Tokyo : Products Team  YOKOI Yasuaki   +81-3-3552-2411Copyright © RIM Intelligence Co. ALL RIGHTS RESERVED.