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Asia Naphtha Crack Widens; Gunvor Sells Fuel Cargoes

By Yee Kai Pin & Ann Koh - 2012-01-05T02:03:06Z

(Corrects crude grade in first paragraph of Jan. 4 story)

Asia’s naphtha crack spread, or premium to Brent crude, widened. Gunvor Group Ltd. sold fuel-oil cargoes for a second day in Singapore, the region’s largest oil- trading center.

Light Distillates

Japan naphtha (NAPHJPNC) swaps were at a premium of $84.52 a metric ton to Brent crude futures at 2:56 p.m. Singapore time, according to data compiled by Bloomberg. This crack spread, a measure of the profit from making the petrochemical and gasoline feedstock, was at $72.96 at the end of Asian trading yesterday.

Honam Petrochemical Corp. bought two naphtha cargoes for delivery in the first half of February to South Korea at about $8 a ton above Japan prices yesterday, a company official said today. The petrochemical producer also purchased a second-half February cargo at a $4 premium.

Royal Dutch Shell Plc, the biggest buyer of 95-RON gasoline (MOGFC95S) in Singapore last month, purchased 50,000 barrels of the grade at $123.20 a barrel from Total SA, based on a Bloomberg News survey of traders who monitored transactions on the Platts window. Morgan Stanley sold 50,000 barrels of 92-RON gasoline to PetroChina Co. at $119.70 a barrel.

Fuel Oil

Gunvor sold two 20,000-ton cargoes of 380-centistoke (N6SHS380) fuel oil to Brightoil Petroleum Holdings Ltd., according to the Bloomberg survey. The Cyprus-based trader received $25 a ton over average February quotes to load from Jan. 29 to Feb. 2.

Fuel oil’s discount (PVMPFD1M) to Dubai crude narrowed 66 cents to $1.96 a barrel at 2:56 p.m. Singapore time, based on date from PVM Oil Associates Ltd., a broker. The gap shrank for the fourth time in five days, signaling reduced losses for refiners turning oil into residual products.

The premium of 180-centistoke (N6SHS180) fuel oil to 380-centistoke grade climbed 25 cents to $12.75 a ton, PVM said. This viscosity spread (PVMP13M1) is the widest since Dec. 16, meaning bunker, or marine fuel, advanced less than higher-quality fuel oil.

Middle Distillates

The premium of gasoil (GASLSICF), or diesel, to Asian marker Dubai crude rose 64 cents to $18.65 a barrel at 2:56 p.m. Singapore time, according to PVM. This crack spread (PVMPGDM1) is the widest since Dec. 9.

Jet fuel (JETKSIFC)’s premium to gasoil slid 5 cents to 55 cents a barrel, PVM said. A narrower regrade (PVMPJG1M) indicates it is less profitable to produce aviation fuel over diesel.

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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