March 19, 2012:

Asia’s gasoil crack spread narrowed the most in four weeks, signaling reduced profit for refiners making the distillate fuel. BP Plc sold jet fuel and gasoline cargoes in Singapore, the region’s biggest oil-trading center.  China, the world’s second-biggest oil consumer, will raise gasoline and diesel prices tomorrow, according to an official with the National Development and Reform Commission, who asked not to be identified because of internal rules.

Middle Distillates

Vitol Group bought 100,000 barrels of jet fuel from BP for April 3 to April 7 loading, according to a Bloomberg survey of traders who monitored transactions on the Platts window. The cargo changed hands at $1.50 a barrel over April quotes.  Jet fuel’s premium to gasoil, or diesel, gained 2 cents to 40 cents a barrel at 2:18 p.m. Singapore time, according to PVM Oil Associates Ltd., a broker. This regrade increased for a fourth day, indicating it is more profitable to make aviation fuel over diesel.  Gasoil (GASLSICF)’s premium to Asian marker Dubai crude fell $1.06 to $15.25 a barrel, PVM said. This crack spread, a measure of processing profit, narrowed the most since Feb. 20.

Light Distillates

Naphtha’s premium to London-traded Brent crude futures was at $137.62 a metric ton at 5:10 p.m. Singapore time from $109.15 a ton on March 16, according to data compiled by Bloomberg. This crack spread widened 26 percent, the most since March 2.  Glencore International Plc sold 25,000 tons of open- specification naphtha for second-half May delivery to Royal Dutch Shell Plc at $1,090 a ton, according to the Bloomberg survey. The Swiss trader, the biggest reported seller of naphtha in Singapore last month, sold a similar cargo to Itochu Corp. at $1,088 a ton.

BP sold 50,000 barrels of 92-RON gasoline for April 14 to April 18 loading to Total SA at $135.60 a barrel, the survey showed. BP sold the same volume for April 8 to April 12 to Trafigura Beheer BV at $135.30 a barrel. Gunvor Group Ltd. sold 50,000 barrels of 92-RON grade to Vitol at $135.40 a barrel for April 3 to April 7 loading, according to the survey. Gunvor also bought 50,000 barrels of 95-RON  MOGFC95S) gasoline for April 9 to April 13 from ConocoPhillips at $138.15 a barrel. Total sold two 50,000-barrel 95-RON cargoes to Shell at $138.40 a barrel, the survey showed.

Fuel Oil

Fuel oil dropped 98 cents to $6.58 a barrel below Dubai crude at 2:18 p.m. Singapore time, according to PVM. The discount widened the most in six days, signaling increased losses for refiners turning oil into residual products.  The premium of 180-centistoke (N6SHS180) fuel oil to 380-centistoke (N6SHS380) grade, or the viscosity spread, was unchanged after advancing to $12.50 a ton, PVM said. This means bunker, or marine fuel, moved in tandem with higher-quality fuel oil.

Refinery News

PetroChina Co. will start a trial run of the expanded Daqing ethylene plant by Oct. 1, its parent company said in a statement on its website. The facility’s capacity will be doubled to 1.2 million tons a year, according to the statement.

Tenders

Mangalore Refinery & Petrochemicals Ltd. offered to sell 40,000 tons of high-speed diesel and the same quantity of vacuum gasoil for May loading from New Mangalore, according to documents e-mailed to potential buyers. 

BP bought 40,000 tons of vacuum gasoil from Mangalore Refinery at a premium of about $9 a barrel to Dubai crude, said two traders who declined to be identified because they aren’t authorized to speak with the media.

Total bought 35,000 tons of naphtha for May loading from Mangalore Refinery, said two traders. Europe’s largest refiner paid a premium of about $46 a ton to Middle East prices.

By Reuters