Bloomberg News

Asia Naphtha Crack Rebounds; Chevron Sells Fuel: Oil Products

March 26, 2012

Asia’s naphtha crack spread rebounded, signaling increased profit for refiners making the petrochemical feedstock. Chevron Corp. sold fuel oil for a second day in Singapore, the region’s biggest oil-trading center.

Light Distillates

Naphtha’s premium to London-traded Brent crude futures rose $9.31 to $122.28 a metric ton at 5:25 p.m. Singapore time, according to data compiled by Bloomberg. This crack spread rebounded from a three-day drop, the longest losing streak in seven weeks.

Glencore International Plc sold 25,000 tons of open- specification naphtha for second-half May delivery to Vitol Group at $1,079 a ton, according to a Bloomberg survey of traders who monitored transactions on the Platts window. Royal Dutch Shell Plc bought a first-half June cargo from Mabanaft GmbH at $1,071 a ton.

Fuel Oil

Chevron sold 20,000 tons of 380-centistoke (N6SHS380) fuel oil to Shell at $2.75 a ton over benchmark quotes, according to the Bloomberg survey. The shipment is for loading from April 10 to April 14.

Fuel oil fell $1.12 to $7.51 a barrel below Asian marker Dubai crude at 2:10 p.m. Singapore time, according to PVM Oil Associates Ltd., a broker. This discount widened the most since March 9, indicating bigger losses for refiners turning oil into residual products.

The premium of 180-centistoke (N6SHS180) fuel oil to 380-centistoke grade, or the viscosity spread, was down 25 cents at $11 a ton, PVM said. This means bunker, or marine fuel, advanced more than higher-quality fuel oil.

Middle Distillates

The premium of gasoil, or diesel, to Dubai crude declined 26 cents to $14.74 a barrel at 2:10 p.m. Singapore time, according to PVM. The difference, also known as the crack spread, is the narrowest since Jan. 10 last year.

Jet fuel’s premium to gasoil lost 5 cents to 15 cents a barrel, PVM said. This regrade slid for the fourth time in five days, showing it is less profitable to make aviation fuel.

Refinery News

Shell said it experienced a “disruption” that caused flaring and a fire alarm at its 500,000 barrel-a-day Pulau Bukom refinery in Singapore, site of a blaze in September last year that halted output.

JX Nippon Oil & Energy Corp. halted its Marifu refinery in western Japan after a blackout, Rim Intelligence reported on its website today, citing a company spokesperson.

Tenders

Ceylon Petroleum Corp. bought gasoil, gasoline and jet fuel from Daewoo Group and BP Plc for April delivery, said a company official who declined to be identified because the information is confidential.

Vitol purchased 40,000 tons of gasoil with 0.5 percent sulfur from Mangalore Refinery & Petrochemicals Ltd. at a premium of about $2 to $2.50 a barrel to Middle East prices, said two traders who declined to be identified because they aren’t authorized to speak to the media.

Mitsui & Co. bought 40,000 tons of vacuum gasoil for May loading from Mangalore Refinery at a premium of around $13 a barrel to Dubai crude, according to two traders.

Gunvor Group Ltd. purchased 35,000 tons of naphtha for April loading from Oil & Natural Gas Corp. at about $41 a ton over Middle East prices, said two traders.

Hindustan Petroleum Corp. offered to sell as much as 30,000 tons of gasoil with 1 percent sulfur for April loading from Visakhapatnam, according to two traders.

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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