Asia Distillates-Gasoil cash differentials weaken, prompt-month spread widens

SINGAPORE, Feb 13 (Reuters) - Asia's cash differentials for 10ppm gasoil weakened on Wednesday, hurt by weaker demand in the physical market, while the prompt-month time spread widened its contango structure. Cash discounts for 10ppm gasoil <GO10-SIN-DIF> were at 43 cents a barrel to Singapore quotes, compared with a discount of 35 cents a barrel on Tuesday. The gasoil cash differentials, after Singapore's benchmark was shifted to 10ppm gasoil in the beginning of last year, touched their lowest of a 98-cent discount in December and have since gained about 48 percent over the last seven weeks. The Feb/March spread widened by a cent to a discount of 45 cents a barrel on Wednesday, compared with 44 cents per barrel a day earlier. Contango market structure, where prompt prices are lower than those for future delivery, tends to encourage holders of physical barrels to store the product and sell it later to secure higher prices. Upcoming spring maintenance outages at some of the regional refineries would likely curb gasoil supply over the next couple of months, but some traders said the availability might not be as tight as expected, thanks to more shipments coming out of China. "I guess the usual 10ppm (gasoil) buyers in the market are not so in a hurry even though they're aware that the spring turnarounds are around the corner," a Singapore-based middle distillate trader said. "This year the market is quite relaxed as some traders believe the Chinese would still be exporting. So as long as there are Chinese barrels, the market is not going to be very tight." Refining margins or cracks for gasoil with 10ppm sulfur content climbed to $14.53 a barrel over Dubai crude on Wednesday, despite a rise in crude oil prices. They were at $14.39 a barrel on Tuesday. Meanwhile, jet fuel cracks also rose to $13.53 a barrel over Dubai crude during Asian trading hours, compared with $13.44 on Tuesday. Cash discounts for jet fuel <JET-SIN-DIF> widened to 34 cents a barrel to Singapore quotes on Wednesday, compared with a discount of 29 cents a barrel on Tuesday.

FUJAIRAH STOCKS - Middle distillate inventories in the Fujairah Oil Industry Zone (FOIZ) rose 4 percent from a week ago to 2.4 million barrels in the week to Feb. 11, data via S&P Global Platts showed.

- Middle distillate stocks in the Fujairah oil hub have averaged about 1.8 million barrels so far in 2019, Reuters calculations showed. This compares with a weekly average of 2.8 million barrels in 2018. - The build of 90,000 barrels in the week to Monday takes Fujairah middle distillate stocks to their highest levels in twelve weeks. - Compared with year-ago levels, the weekly Fujairah middle distillate stocks were mostly unchanged.

API INVENTORY DATA - U.S. crude stocks fell unexpectedly last week, while gasoline inventories increased and distillate stocks drew, industry group the American Petroleum Institute said on Tuesday.

- Crude inventories fell by 998,000 barrels in the week to Feb. 8 to 447.2 million, compared with analysts' expectations for an increase of 2.7 million barrels. - Distillate fuels stockpiles, which include diesel and heating oil, fell by 2.5 million barrels, compared with expectations for a 1.1 million-barrel drop, the API data showed.

SINGAPORE CASH DEALS - Two gasoil deals, one jet fuel trade. - Winson Oil sold two separate cargoes of 166,000 barrels of 10ppm gasoil each to Vitol for Feb. 28-March 4 loading at a discount of 45 cents a barrel to Singapore quotes. - Singapore trader Hin Leong bought 100,000 barrels of jet fuel from Zenrock for March 2-6 loading at a discount of 30 cents a barrel to Singapore quotes. - For more information, please click

OTHER NEWS - Asia's oil refiners are increasingly finding themselves trapped between the rock of OPEC's production cuts and the hard place of U.S. President Donald Trump's sanctions against Iran and Venezuela. - Oil prices rose on Wednesday as producer club OPEC said it had cut supply deeply in January and as U.S. sanctions hit Venezuela's oil exports. - OPEC said on Tuesday it had cut oil production steeply under a global supply deal, although it flagged headwinds confronting its efforts to prevent a glut this year including weaker demand and higher rival output. - Venezuela's oil exports have tapered off and shifted toward India since new U.S. sanctions began Jan. 28 as state-run oil company PDVSA seeks to replace deliveries to the United States and Europe that were disrupted by payment restrictions.

ASSESSMENTS MID-DISTILLATES

CASH ($/T) ASIA CLOSE Change % Change Prev Close RIC Spot Gas Oil 0.5% 74.61 1.24 1.69 73.37

<GO-SIN

GO 0.5 Diff -2.72 0.01 -0.37 -2.73

<GO-SIN-DIF>

Spot Gas Oil 0.25% 75.14 1.24 1.68 73.90

<GO25-SIN>

GO 0.25 Diff -2.19 0.01 -0.45 -2.20

<GO25-SIN-DIF>

Spot Gas Oil 0.05% 75.69 1.23 1.65 74.46

<GO005-SIN>

GO 0.05 Diff -1.64 -0.01 0.61 -1.63

<GO005-SIN-DIF>

Spot Gas Oil 0.001% 76.90 1.15 1.52 75.75

<GO10-SIN>

GO 0.001 Diff -0.43 -0.08 22.86 -0.35

<GO10-SIN-DIF>

Spot Jet/Kero 76.02 1.12 1.50 74.90

<JET-SIN>

Jet/Kero Diff -0.34 -0.05 17.24 -0.29

<JET-SIN-DIF>

For a list of derivatives prices, including margins, please

double click the RICs below. Brent M1

Gasoil M1

Gasoil M1/M2

Gasoil M2

Regrade M1

Regrade M2

Jet M1

Jet M1/M2

Jet M2

Gasoil 500ppm-Dubai

Cracks M1 Gasoil 500ppm-Dubai

Cracks M2 Jet Cracks M1

Jet Cracks M2

East-West M1

East-West M2

LGO M1

LGO M1/M2

LGO M2

Crack LGO-Brent M1

Crack LGO-Brent M2

(Reporting by Koustav Samanta; Editing by Shreejay Sinha)