Oct. 19 (Bloomberg) -- Asia naphtha derivative contracts were poised to rebound from the lowest in a week. Gasoil’s crack spread narrowed, signaling decreasing profit for refiners making the distillate fuel.
Japan’s open-specification naphtha forward contracts for second-half November delivery were bid at $916 a metric ton against offers at $919 at 12 p.m. Singapore time, according to data from Ginga Petroleum Singapore Pte, a broker. Yesterday, the petrochemical feedstock closed at a one-week low of $904.
Naphtha’s premium to London-traded Brent crude futures was up $1.21 at $67.80 a ton, based on data compiled by Bloomberg. This crack spread, a measure of processing profit, has shrunk 47 percent so far this month.
Gasoline’s premium to naphtha yesterday declined to $23.40 a barrel, the lowest since Oct. 5, Bloomberg data showed. A narrower reforming margin means it is less profitable to produce motor fuel.
The premium of gasoil, or diesel, to Asian marker Dubai crude fell 31 cents to $15.82 a barrel, according to PVM Oil Associates Ltd., a broker. This crack spread narrowed for the second time in three days.
Gasoil swaps for November rose $1.50, or 1.2 percent, to $122.70 a barrel, PVM data showed. Jet fuel’s premium to gasoil climbed 5 cents to $3.05. This regrade was the highest since Feb. 23, indicating it is more profitable to make aviation fuel over diesel.
Fuel oil’s discount to Dubai crude widened 77 cents to $5.19 a barrel, according to PVM. The gap increased for the first time in three days, signaling losses are growing for refiners turning oil into residual products.
November high-sulfur fuel oil swaps advanced $6.75, or 1 percent, to $661 a ton, PVM said. The premium of 180-centistoke fuel oil to 380-centistoke grade was unchanged after slipping to $7.50. A narrower viscosity spread shows bunker, or marine fuel, gained more than higher-quality fuel oil.
--Editors: Ryan Woo, Mike Anderson.
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