Bloomberg News

Shell Buys Singapore Gasoline; Gasoil Crack Gains: Oil Products

October 13, 2011

Oct. 13 (Bloomberg) -- Royal Dutch Shell Plc boosted its gasoline purchases in Singapore, Asia’s largest oil-trading center. Gasoil’s crack spread widened, and fuel oil’s discount to crude narrowed.

Light Distillates

Shell bought 50,000 barrels of 95-RON gasoline in Singapore from Total SA at $125.30 a barrel, according to a Bloomberg survey of traders monitoring transactions on the Platts window. The cargo is for loading from Nov. 2 to Nov. 6. Shell, Europe’s largest oil company, has purchased at least 750,000 barrels of gasoline since Sept. 29, a day after a fire at its Pulau Bukom refinery in Singapore.

Naphtha’s premium to London-traded Brent crude futures increased $7.60 to $73.74 a metric ton at 5:40 p.m. Singapore time, based on data compiled by Bloomberg. This crack spread, a measure of refining profit, was at $37.89 on Oct. 11, the narrowest since May 2009.

Middle Distillates

BP Plc sold 150,000 barrels of gasoil, or diesel, with 0.5 percent sulfur to Hin Leong Trading Pte in Singapore, according to the Bloomberg survey. The price was 40 cents a barrel over benchmark quotes, a reduced premium from 50 cents in a transaction yesterday. The cargo is for Oct. 28 to Nov. 1, the earliest loading period.

Gasoil’s premium to Asian marker Dubai crude climbed 40 cents to $15.70 a barrel at 2:06 p.m. Singapore time, based on data from PVM Oil Associates Ltd., a broker. This crack spread widened for the first time in three days.

Jet fuel’s premium to gasoil dropped 15 cents to $2.25 a barrel, PVM said. This regrade is the lowest so far in October, indicating it is becoming less profitable to produce aviation fuel over diesel.

Shell sold 150,000 barrels of jet fuel to BP at 10 cents a barrel over quotes, the survey showed. The cargo will load Nov. 3 to Nov. 7.

Fuel Oil

Hin Leong bought 380-centistoke fuel oil in Singapore for a second day, according to the Bloomberg survey. The closely held trader paid $8 a ton over October quotes to Lukoil OAO and BP for 20,000 tons each for loading Oct. 28 to Nov. 1. Yesterday, Hin Leong paid an $8.50 premium.

Fuel oil’s discount to Dubai crude narrowed 53 cents to $2.96 a barrel at 2:06 p.m. Singapore time, PVM data showed. That’s the smallest gap since Oct. 4, signaling reduced losses for refiners turning crude into residual products.

The premium of 180-centistoke fuel oil to 380-centistoke grade decreased 25 cents to $8 a ton. A narrowing viscosity spread means higher-quality fuel oil has declined less than bunker, or marine fuel.

--Editors: Mike Anderson, Alex Kwiatkowski

To contact the reporter on this story: Yee Kai Pin in Singapore at kyee13@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net


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