Gasoline: Tight supply uneased

　The differential for MR-size cargos of 92RON gasoline on an FOB Northeast Asia basis was unchanged on week. Talks were shifting to December loading cargoes, but the market remained quiet as it was a little too early to start talks on them. However, exports from China were expected to remain few, and refiners in the country were not in a hurry to sell volumes in the month. As reported before, oil companies in the country were running short of their export quotas of oil products this year. Meanwhile, the South Korean government was planning to terminate the tax cut policy on oil products at the end of this year. Therefore, refiners in the country were focusing on the policy and were possibly going to delay their spot sales for cargoes in the month. On the demand side, Petrolimex in Vietnam was conducting a tender to buy 95RON gasoline cargoes. Tendered were two MR-size cargo loading on Dec 4-8 and Dec 8-12 and two half MR-size cargoes loading on Dec 16-20 and Dec 20-24.

Naphtha: late Dec arrival buying interest is quiet

The second half December open-spec naphtha prices on a CFR Japan basis stayed in the same level on week. Demand was limited in the spot market. South Korean companies were expected to decrease stocks of petrochemical products in December, the end of fascial year and it would make naphtha consumptions fewer. Japanese companies seemed to have weak buying interest as they did not raise the operation rates of naphtha crackers. One Japanese petrochemical company started negotiations of annual term contracts in 2025.

In China, an ethylene production unit at Tianjin Nangang had accepted feedstocks and confirmed on-spec ethylene productions. It would attract attentions in the market whether imports volume by Sinopec, the investor would increase or not.

In Japan, Idemitsu Kosan started to resume one of its naphtha crackers in Tokuyama plant. The refiner was reportedly scheduled to resume another naphtha cracker on around Nov 15. In South Korea, GS Caltex was having regular maintenance at its naphtha cracker until around Nov 29.　　

Middle distillates: Jet overheated market cooling with ME/India cargoes infows

The differential for MR-size cargoes of jet fuel on an FOB Northeast Asia basis went down. A sense of overheat in the market receded due to increasing supply. Supply from the Middle East and India to the Asia and Oceania regions was increasing. The tight supply/demand fundamentals diminished as major buyers such as Australian companies secured cargoes from the Middle East and India.

　The differential for MR-size cargoes of 0.001% sulfur and 0.05% sulfur gasoil on an FOB Northeast Asia basis increased. A sense of thin supply was strengthening as exports from China, one of the mail sellers of the fuel in the region, were few. Meanwhile, buyers in Indonesia were also showing their interests in purchasing low-sulfur gasoil.

Fuel oil: Tight supply boosts FOB Korea 0.5%S FO up

　The differential for MR-size cargoes of 0.5% sulfur fuel oil on an FOB South Korea basis was narrowing amid tight supplies. Oil companies in Asia prioritized the bunker fuel market for shipping, where prices moved on a firm tone, limiting export cargoes. On top of that, Singapore and surrounding areas still saw supply shortages of low sulfur fuel oil (LSFO), which might also provide Northeast Asia LSFO with a bullish factor, a market participant said. Another player expected LSFO supply would be tight throughout Asia for the time being.

　The price for VLSFO in Tokyo Bay was at $601.50/mt as of Nov 6, went up on week with a rise in the 0.5% sulfur fuel oil paper swaps values in Singapore. Alternate demand from Shanghai and Zhoushan, China was witnessed. Prices in China stayed high on tight supply/demand fundamentals. On the other hand, the price gap between Tokyo and some Asia ports such as in South Korea, Hong Kong, and Singapore was widening again. Some shipping companies were refraining from procuring bunker fuel in Japan. There were both bullish and bearish factors in the market.