Asia Gasoline Snaps Rally; Crack Spreads Slip: Oil Products

Asia gasoline snapped the longest rally in more than five years. Gasoil’s crack spread fell from the highest since January 2009 and losses from making fuel oil widened to the most in 18 months.

Light Distillates

Benchmark 92-RON gasoline fell 60 cents, or 0.6 percent, to $100.35 a barrel, according to data compiled by Bloomberg. Prices ended a nine-day rising streak, the longest rally since February 2005.

Gasoline’s premium to naphtha, or the reforming margin, fell to $7.40 a barrel from $8.30 yesterday, when it was the widest since Aug. 6, Bloomberg calculations showed. A narrowing gap indicates naphtha is more valuable to refiners relative to gasoline.

The premium of naphtha for delivery to Japan to Brent crude rose to $161.13 a metric ton at 5:58 p.m. in Singapore, Asia’s biggest oil-trading center, based on Bloomberg data. This crack spread was $159.19 yesterday.

Open-specification naphtha for delivery to Japan gained $3, or 0.4 percent, to $852 a ton, the highest in more than two years, Bloomberg data showed.

In Singapore, Arcadia Petroleum Ltd. sold 50,000 barrels of 95-RON gasoline loading Dec. 23 to Dec. 27 to Noble Group Ltd. at $102.20 a barrel, traders said. Glencore International AG sold 25,000 tons of naphtha for first-half February delivery to BP Plc at $853.50 a ton.

Middle Distillates

Benchmark gasoil, or diesel, with 0.5 percent sulfur fell 50 cents, or 0.5 percent, to $102.65 a barrel, according to Bloomberg data. Jet fuel also dropped 50 cents, or 0.5 percent, to $103.50. Each product ended a three-day climb.

Gasoil’s premium to Dubai crude decreased 24 cents to $14.58 a barrel, according to data from PVM Oil Associates, a brokerage. The crack spread, a measure of refining profit, rallied in the four days to yesterday to reach $14.82, the widest since January 2009.

In Singapore, China International United Petroleum & Chemical Corp., or Unipec, bought 0.5 percent sulfur gasoil from Singapore Petroleum Co. and Total SA, traders said. It received discounts of 5 cents and 8 cents a barrel to benchmark quotes, respectively. BP, the biggest buyer of ultra-low-sulfur grade this year, purchased 170,000 barrels from Glencore at $1.90 a barrel over quotes. That’s the smallest premium in two weeks.

Jet fuel’s premium to gasoil declined 5 cents to $1.15 a barrel, according to PVM. This regrade was at the narrowest in two weeks, indicating aviation fuel is less profitable compared with diesel.

Fuel Oil

Singapore 180-centistoke fuel oil declined $6.25, or 1.2 percent, to $510 a ton, Bloomberg data showed. The price of 380-centistoke fuel oil, mainly used as marine fuel, was down $6.75, or 1.3 percent, at $499.75. Each product pulled back the most in two weeks.

Fuel oil’s discount to Dubai crude, or the crack spread, widened for a fourth day to $9.11 a barrel, Bloomberg data showed. This indicates losses from making the residue were the biggest since June 2009.

Brightoil Petroleum Holdings Ltd. bought 380-centistoke fuel oil from Kuo Oil Ltd., bringing its purchases in the past four days to 14 cargoes, or 300,000 tons, traders said. The price was 25 cents a ton over benchmark quotes. Itochu Corp. sold a similar cargo to Royal Dutch Shell Plc at minus 25 cents, the first discount in two weeks.

Refinery News

China Petrochemical Corp., or Sinopec Group, said it boosted oil processing volume by 40 percent in the past five years, becoming the world’s second-largest refiner as fuel consumption surges. China is the world’s biggest energy user.

Oil processing at Sinopec’s refineries rose to an estimated 208 million tons this year, or about 4.2 million barrels a day, from 149 million tons in 2005, the company said in a statement.

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