Bloomberg News

Asia Naphtha Crack Narrows; PetroChina Sells Fuel: Oil Products

February 28, 2012

Asia’s naphtha crack spread narrowed from the widest in a week. PetroChina Co. sold fuel-oil cargoes for a fourth day in Singapore, the region’s biggest oil-trading center.

Light Distillates

Japan naphtha’s premium to London-traded Brent crude futures dropped to $124.66 a metric ton at 3 p.m. Singapore time from $130.75, according to data compiled by Bloomberg. This crack spread yesterday was the widest since Feb. 20.

Trafigura Beheer BV sold 50,000 barrels of 97-RON (MOGFC97S) gasoline loading from Tanjung Langsat in Malaysia, where the company leases storage tanks, based on a Bloomberg News survey of traders who monitored transactions on the Platts window. Vitol Group bought the cargo at $137.30 a barrel.

Trafigura also sold 50,000 barrels of 97-RON grade for loading from Singapore to Royal Dutch Shell Plc at $137.80 a barrel, the survey showed.

Fuel Oil

PetroChina sold two 20,000-ton cargoes of 380-centistoke (N6SHS380) fuel oil, according to the Bloomberg survey. It received $3 a ton above benchmark quotes from Brightoil Petroleum Holdings Ltd. to load from March 23 to March 27 and a $2 premium from Shell for March 25 to March 29.

Lukoil OAO sold a similar cargo to Hin Leong Trading Pte at a $1 a ton over Singapore quotes for March 14 to March 18 loading, the survey showed. That’s a reduced premium from $5 in the most recent transaction reported Feb. 24.

Fuel oil dropped 65 cents to $7.15 a barrel below Asian marker Dubai crude at 2:19 p.m. Singapore time, based on data from PVM Oil Associates Ltd., a broker. That’s the biggest discount since Sept. 7, signaling losses for refiners turning oil into residual products.

The premium of 180-centistoke (N6SHS180) fuel oil to 380-centistoke grade, or the viscosity spread, climbed 50 cents to $12 a ton, PVM said. This means bunker, or marine fuel, declined more than higher-quality fuel oil.

Middle Distillates

The premium of gasoil, or diesel, to Dubai crude rose 39 cents to $15.32 a barrel at 2:19 p.m. Singapore time, according to PVM. This crack spread, a measure of refining profit, rebounded from the narrowest since Jan. 12.

Jet fuel’s premium to gasoil fell 5 cents to 75 cents a barrel, PVM said. This regrade narrowed for a second day, indicating it is less profitable to produce aviation fuel over diesel.

Tenders

China Aviation Oil Singapore Corp. closed a tender seeking as much as 1.2 million barrels of jet fuel for March and April loading, according to a document sent to potential sellers.

To contact the reporters on this story: Yee Kai Pin in Singapore at kyee13@bloomberg.net; Ann Koh in Singapore at akoh15@bloomberg.net

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


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